Daily Forex Fundamental Analysis – Jan 10, 2018

The dollar gave up ground as the yen advanced sharply in the earlier trading sessions, but the US currency was able to rebound as Treasuries hit record highs. Equities also continued their ascent in anticipation of a positive earnings season kicking off on Friday. US JOLTS job openings and NFIB Small Business Index both disappointed while import prices and final wholesale inventories data are due next.
The euro was able to hold its ground thanks to upbeat medium-tier data. German industrial production rose 3.4% versus the estimated 1.9% gain while their trade balance printed a larger surplus of 22.3 billion EUR versus the estimated 20.7 billion EUR and the earlier 19.7 billion EUR. French trade balance came in weaker than expected, though. French industrial production is due next, along with the German 10-year bond auction.
The pound struggled to stay afloat on the lack of major reports from the UK and fading sentiment from the cabinet reshuffle. Today’s UK manufacturing production report could change that as analysts predict a stronger 0.3% increase compared to the earlier 0.1% uptick. The goods trade balance is also due and a larger deficit of 10.9 billion GBP from the earlier 10.8 billion GBP is eyed.
The franc continued to slide against most of its peers as data came in mixed. The unemployment rate held steady at 3.0% as expected but the earlier reading was negatively revised. Retail sales posted a better than expected 0.2% dip instead of the estimated 2.5% fall while foreign currency reserves ticked slightly higher from 738B CHF to 744B CHF. There are no other reports due from the Swiss economy today.
The yen was the start of the forex show as it jumped across the board when the BOJ reduced its JGB purchases. This revived taper hopes after officials hinted at exiting their aggressive stimulus program late last year. Data from Japan came in mixed, with average cash earnings up 0.9% versus the estimated 0.6% uptick and the consumer confidence figure slipping from 44.9 to 44.7 instead of improving to 45.1.
Commodity Currencies (AUD, NZD, CAD)
The comdolls were able to score some wins against a few of their rivals but the rallies were limited as gold was weighed down by risk-taking and the Loonie didn’t join in the crude oil rally. Canadian housing starts turned out weaker than expected while China’s CPI fell short of estimates at 1.8% versus 1.9%. PPI was slightly better than expected at 4.9% versus 4.8% but still lower than the earlier 5.8% gain. EIA crude oil inventories are due next.
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With an upbringing rooted in deep ethical values, Yashu Gola knows how to put honesty and dedication into his articles. This young and dynamic financial analyst has done his graduation in IT engineering. His interests in financial writing have once brought him to our digital doorsteps. Since then, he has been an integral part of ForexMinute.com and writes the most captivating news-articles on the foreign exchange industry, cryptocurrencies, and medical marijuana trading.