Morning brief October 13, 2016
The main trigger of the session was the release of the FOMC Minutes that indicated that a growing number of committee members are pulling in the direction of hiking (the FOMC voted 7-3 to hold off a rate hike at Sept. meeting). It seems that the Chair Janet Yellen’s call weighted on the FOMC’s intention to raise rate. She stressed that August steadiness in labor force participation still had room to increase and suggested to wait for more positive signals to confirm the job market recovery. The Fed’s hesitation on when to rise rates and increase in number of the UK new buyer enquiries gave a tiny support to pound which lifted itself to 9 – 10 odd points. Euro and franc remained in a relatively small ranges.
The major focus of the latest Asian session was September trade data from China. It showed reduction of export casting a renewed shadow over global growth prospects. The market response was a bit delayed, but when EUR/USD surged adding 30 points from its session low, while AUD/USD dropped having posted 3-month lows at 0.7520. NZD will unlikely show us any strength today; in the course of the last session it rose at about 20 points. USD/JPY fell once the release from China has been published. We might see more gains for the yen and other safe-haven assets with the gloomy sentiments over the future of the global economy.
Gold is gaining momentum from its recent downfall; it lifted itself up to the $1255.5 and now continues to pave the way to the new resistance line at $1262,51 near the 200-day MA.
Oil prices experienced a 1% drop overnight after OPEC members reported its output hit an 8-year high in September. This announcement offset optimism over the group's pledge to restrict output.
The economic calendar for today will unlikely bring us lots of shake things. There will be US unemployment claims which could reach 252,000 this week, according to the forecasts (an indicator of the overall economic health of the country as consumer spending is affected by labor-market conditions). And also we recommend you to keep an eye on the US crude oil inventories.