Cable reaches fresh lows ahead of Carney speech
City Index September 9, 2014 2:30 PM
<p>The FX markets enjoyed another volatile session as the dollar continues to trade with a bid tone despite the disappointing non-farm payrolls data last week. US […]</p>
The FX markets enjoyed another volatile session as the dollar continues to trade with a bid tone despite the disappointing non-farm payrolls data last week. US yields moved higher following a research paper released by the San Francisco Federal Reserve which was titled ‘Assessing Expectations of Monetary Policy’ where, based on surveys, they suggested that the public seems to expect a more accommodative policy than the Federal Open Market Committee participants. US 10-year treasury yields opened at 2.48%, rallying to a high of 2.4999%.
USD/JPY now looks comfortable on the 106 handle as the BoJ minutes continued to echo the policy of easing measures to achieve the 2% inflation goal. PM Shinzo Abe’s senior advisor Honda suggested that there should be a delay in further sale tax hikes, indicating that the BoJ will implement fresh easing measures.
AUD came under pressure in the Asian session as the NAB business confidence survey fell two points to eight, from the expected 10 as mortgage data disappointed at just 0.3%.
Cable pushed to fresh lows below 1.6100 as once again the Scottish referendum dominated proceedings. The latest poll continued the momentum for the ‘yes’ campaign as the TNS-BMRM poll, which is bigger than the YouGov poll, revealed a 50-50 outcome for independence. My own personal view is that whilst bookmakers make the no vote as odds on favourite then this media circus around the polls really has little credibility. Although there are reports this morning that MPs have warned PM David Cameron that his future as leader depends on the outcome, with suggestions that he has asked the Queen to publicly address the need for the Union to remain.
UK industrial production and manufacturing output data will be the highlight releases today as BoE Governor Mark Carney will address the Trade Union Congress in Liverpool at 11.30am. The US market will look to the Jolts job openings this afternoon.
Supports 1.2870-1.2840-1.2785 | Resistance 1.2920-1.2970-1.3000
Supports 105.75-105.20-104.70 | Resistance 106.55-107.00-108.00
Supports 1.6060-1.6000-1.5855 | Resistance 1.6125-1.6150-1.6190
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.