EUR/USD – Fireworks Expected from the Final Fed Meeting of the Year

The final Fed meeting of the year could also be the most eventful, with the central bank likely to acknowledge it’s done with tightening and even signal rate cuts next year. The question is how many, with markets now pricing in four starting in May.

Sunset Market Commentary

UK gilts and sterling catch the eye today. Yields in the country tank between 9.8 (30-y) and 13.3 bps (2-y). Sterling dropped with EUR/GBP, after testing the 0.86 yesterday, now moving past that level more convincingly (0.8612). Reason for the move s this morning’s batch of October eco data.

Australian Dollar Rebounds Despite Soft GDP

The Australian dollar has bounced back on Wednesday and snapped a two-day losing streak. In the European session, AUD/USD is trading at 0.6574, up 0.34%.

Canada's Trade Accounts Register a $3.0 Billion Surplus in October

Canada's merchandise trade account recorded a trade surplus of $3 billion in October, the third consecutive month in black ink. This comes after September's surplus was revised slightly upward to $1.1 billion.

US Private Sector Slowed Hiring, ADP Says

ADP reported a 103k increase in new private sector jobs in the US, against expectations of 130k and 106k (revised from 113k) a month earlier.

Scream Correction

US crude plummeted 4% yesterday and sank below the $70pb mark and Brent slipped below $75pb. Momentum traders and falling volumes worsened crude’s recent plunge while OPEC’s latest announcement of output cuts and Saudi’s additional threats that they will extend their solo cut beyond Q1 went totally unheard.

Japanese Yen Outperforms This Morning

The Japanese yen outperforms this morning, pushing USD/JPY to the lowest (146.32) since early September. EUR/JPY extends a losing streak to nine days with the pair currently trading at 157.45. Moves in other currency pairs are muted. EUR/USD is trading stable after a late-session hit yesterday pushed the pair sub 1.08 towards 1.076. Sterling’s momentum eased.

BTC and ETH Pause as Altcoins Take the Spotlight

Cryptocurrency market capitalisation changed little at the end of trading on Wednesday, remaining close to $1.59 trillion (-0.14% d/d). But this modest result is a show of strength, given the pressure in equity markets, which intensified selling in Bitcoin and Ether.

Sunset Market Commentary

A fairly thin eco calendar and blackout-periods for major central bankers made this morning’s Japanese moves the main talking point. Comments by deputy governor Himino and governor Ueda suggest a sense of urgency within the BoJ to normalize policy rates before the window of opportunity closes.

Japanese Yen Stays Top of Mind

The Japanese yen stays top of mind. BoJ deputy governor Himino and his boss Ueda triggered a scorching rally amid rising bets of an imminent (December 19) policy shift. USD/JPY fell from an open at 147.31 to an intraday low of 141.71. The pair eventually closed at 144.13 with strong support from the 200dMA (142.33) and the 38.2% retracement (142.48) on the 2023 advance for the time being a too tough nut to crack.