Jan. 15: MARKET OVERVIEW
FXBAZOOKA.com - USD got hit on Wednesday after American retail sales posted their largest decline in 11 months in Dec. (Core Retail Sales plunged by 1.0%). Weak data made investors take profit on USD. On Thursday, however, US yields recovered pushing USD higher: the market still expects the Fed to tighten policy earlier than other central banks.
USD/JPY recovered to 117.90 after dipping to 116.07 yesterday. Bank of Japan Governor Haruhiko Kuroda said today that the country’ economy is recovering moderately, and that the BOJ will maintain its quantitative and qualitative easing for as long as needed (that’s a very different approach compared with the Fed, so bullish comments for USD/JPY).
AUD/USD jumped above 0.8200 after strong jobs data led the market to scale back the risk of the Reserve Bank of Australia’s interest rate cuts in the short-term.
GBP/USD touched 1.5268 yesterday on bad US data and the Bank of England Carney’s comments that falling oil prices are “net positive: for the UK economy.
EUR/USD is trading below 1.1800 after a volatile day yesterday. The ECB on Wednesday won crucial backing for such purchases from a top EU legal adviser, who said a 2012 ECB bond-buying blueprint did not break EU law. That opens the way to QE and is EUR-negative.
Don't miss more data from the US later today (previous & forecasts readings):