Kung Hei Fat Choi – Chinese New Year
Quote of the day: “Kung Hei Fat Choi!”
February 8th: Highlights
- Non-Farm Payrolls missed forecasts
- Wage inflation helps dollar
- AUD & CAD sell-off after NFP data
- Chinese New Year
There is nothing on the calendar from the UK today. Looking at the week ahead, we have Trade Balance figures tomorrow and then manufacturing and industrial production on Wednesday, which could help to offset the weaker PMI data released last week and provide some support for the Pound.
A YouGov poll has been released, showing a 9-points lead for the ‘No’ campaign. The market remains quietly nervous about the prospects of the referendum, currently planned or June, and many business leaders fear that a Brexit will harm the UK economic recovery.
Considering your next transfer? Log in to compare live quotes today.
On the face of it, Friday’s Non-Farm Payroll data was a fairly bleak reading. It missed forecasts at 151k (190k forecast), which was way off last month’s reading of 292k, which was revised down by 30k. However, the unemployment rate was good (4.9%) and average hourly earnings data was higher (+0.5%), which added together to support the USD. The market is still taking every data reading as it comes and measuring this against Yellen’s earlier forecast of four rate hikes in 2016. Currently, market expectations don’t match this, pricing in only a 47% chance of a rate hike in December.
Employment data from Canada disappointed, pushing the unemployment rate up to 7.2% (from 7.1%), when coupled with a lower oil price and the US NFP data saw the CAD weaken, along with all the commodity-related currencies. The worst performer was Australia, where the AUD slumped the furthest and has suffered from thinner trading volumes on the open today, with China closed for the New Year. RBA Governor Stevens speaks on Thursday, which may help support the AUD.
Kung Hei Fat Choi to the Year of the Monkey! Central to many celebrations are wishes for luck, prosperity and good fortune, whilst warding off evil spirits. There are parallels to be drawn with China’s currency reserves, which have reduced to a 3-yr with all the efforts to prop up the CNY. Further, the PBoC is reported to be focused on monetary stimulus after China’s growth rate fell to its lowest level in 25 years. Currency moves are likely to be limited this week as Chinese markets will be closed for the New Year.
Have a great day!
Morning mid-market rates – The majors
85% savings. Job Done. So, what is the secret sauce of the CurrencyTransfer.com marketplace?
How are we innovating?
Well, we are not an expensive bank costing you up to £1,500 on every £50,000 trade. Neither do you ever need to ring around multiple brokers and speak to sales guys. Pretty inaccurate way of shopping around. We help you maximise the value of each transfer. Quite simply, you are in control. Foreign exchange companies compete in a LIVE marketplace to win your business.
Got a question? We’d be delighted to help!
Director of Sales & Operations
t: +44 (0) 20 7096 1036