China has responded to the UK announcing new sanctions on individuals and groups "supporting and funding Putin's war machine".
The UK's sanctions targeted 31 people and entities, including three Chinese entities for supplying sanctioned goods.
China warned the UK that any action harming China's interests "will be met with a firm response".
China urged the UK to "correct its mistakes and withdraw the sanctions on Chinese firms".
It wasn't too long ago that China banned the import of many goods from China in retaliation for perceived slights. the Australian dollar took hits on the trade war moves. Let's hope GBp is more resilient should the Chinese Communist Party do the same to the UK.
JP Morgan CEO Jamie Dimon spoke in the US Congress at a Senate hearing on Wednesday, alongside seven other big bank CEOs.
Dimon has been a long-time opposer of crypto
and he reiterated his stance, suggesting it should be banned:
Bitcoin is not bothered, its sitting around USD44K
The employment statistics continued ahead of the US jobs report on Friday. Today the ADP employment change came in at 103K versus 130K expected. Recall from yesterday the JOLTs job openings showed a greater than expected fall (weaker employment). On Friday the US non-farm payroll data is expected to show a gain of 185K versus 150K last month. The unemployment rate is expected to remain steady at 3.9%.
Also released today was the final Q3 numbers for productivity and labor costs. US revised its labor cost for the 3Q to -1.2% versus -0.9%, while productivity increased to 5.2% from 4.9%. In contrast Canada labor productivity fell -0.8% versus -0.6% expected.
In addition to the data, the Bank of Canada announced its interest rate decision today. The central bank kept rates unchanged as expected at 5.0%. Having said that, the central bank reiterated its readiness to further increase the policy rate if necessary, reflecting a proactive stance in managing economic conditions.
The central bank said that recent data indicates that the Canadian economy is no longer experiencing excess demand, suggesting a shift from previous trends. The BOC has observed signs that its monetary policy is effectively moderating spending and alleviating price pressures, contributing to a slowdown in the economy. This deceleration is helping reduce inflationary pressures across a wide array of goods and services. The Governing Council is focused on achieving further and sustained easing in core inflation to ensure economic stability.
On a global scale, the BOC series economic growth decelerating, and inflation showing signs of easing. In the United States, economic growth has surpassed expectations but is anticipated to weaken in the coming months. Meanwhile, economic growth in the Euro area has been slowing down. The oil market has seen a notable change, with prices now about $10-per-barrel lower than projected in the October Monetary Policy Report (MPR). Additionally, the US dollar has weakened against most currencies, including the Canadian dollar. Domestically, higher interest rates have significantly curtailed spending, as evidenced by near-zero growth in consumption over the last two quarters. Furthermore, the labor market is showing signs of easing, with job creation lagging behind the growth of the labor force.
The price of the USDCAD traded in an up-and-down trading range soon after the announcement (between moving averages), before breaking higher (lower CAD) in North American afternoon trading.
The gains were also helped by a break above the 100-day moving average and 200-hour moving average both near 1.3574 (see green and blue stepped line on the chart below).
The current price is trading at 1.3593. Staying above those moving averages would keep the technical bias tilted more to the upside. A move higher into the new trading date would have traders targeting the 38.2% retracement of the move down from the November 10 high. That level comes in at 1.36224.
Looking at the winners and losers in the Forex,, the NZD is the strongest and the EUR is the weakest. The USD shifted more to the upside in the North American session with gains first the EUR and GBP leading the USDs charge. The US dollar rose 0.29% versus the EUR and rose 0.27% versus the GBP.
The dollars moved to the upside came despite the coins in US yields once again:
Crude oil continued its fall to the downside as a traders focused on slower global growth. German factory orders came in much lower than expected today at -3.7%. With the ADP jobs report coming out weaker, traders took the clues from slower growth. The US weekly oil inventory data showed a bigger than expected drawdown of -4.632 million versus -1.35 million in crude oil inventories. However the products including distilates with a build of +1.267 million, and gasoline with a large build of +5.421% offset the declines in the crude inventories.
US stocks gave up early gains and closed the day lower
Bank of France Governor and therefore European Central Bank Governing Council member Villeroy was speaking with a French paper in an interview published on Wednesday:
Villeroy is not the only participant in the market to mulling 2024 European Central Bank rate cuts, forecasts for cuts are gathering pace.
US Treasury Secretary Yellen remarks hitting the news:
Its not unusual for public sector employees to tell those in the private sector that they're doing their jobs wrong. Such advice is best ignored. The job of bond traders, and all traders, is to make $$$, not keep the bureaucrats happy.
The major indices slumped into the close with the Nasdaq index hit the hardest. A snapshot of the close levels and shows:
To summarize and rank the "Magnificent Seven" stocks from best to worst performance based on the given data:
Looking at the broader S&P index, three of the 11 components showed gains led by utilities and eight moved lower with energy performing the worst. Crude prices are down over 4.1% in trading today helping to lead to the decline in the energy component sector
Winners (Positive Performance):
Losers (Negative Performance):
While its an active data agenda its likely that we'll be waiting for the Chinese trade data for any FX market impact. Its listed at 0300 GMT, which is 2200 US Eastern time, but that is only a guide as this data is not known for arriving on schedule. Exports are expected to soften a little from October while imports are the opposite. Rising imports is often interpreted as a sign of economic strength, lets hope that's the case for the folks in China. If so it'll underpin China and China-proxy trades.
This snapshot from the ForexLive economic data calendar, access it here.
The times in the left-most column are GMT.
The numbers in the right-most column are the 'prior' (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.
Good morning, afternoon and evening all. Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share and discuss with fellow ForexLive traders, please do so:
MUFG predicts a substantial decrease in the USD/JPY exchange rate over the course of 2024, citing factors including US yield developments, Japan's aggressive inflation policies, and the Bank of Japan's anticipated policy shifts.
MUFG's analysis indicates a significant potential drop in USD/JPY in 2024, driven by a combination of factors including US economic trends, Japan's aggressive fiscal and monetary policies to combat inflation, and expected policy shifts by the BoJ. The forecasted decline in USD/JPY reflects the interplay of these domestic and international economic factors and central bank policies.
The US dollar is at the best levels of the day as equities wilt. The S&P 500 is down 0.3% and the Nasdaq down 0.4%.
The declines in equities and the rally in the dollar come despite falling yields for the second day. US 10-year yields are down 4.4 bps today and near the lows of the day.
One of the reasons the dollar is strong is that yields elsewhere are falling faster. The market is coming around to the idea that the ECB will cut rates before the Federal Reserve; the Australian dollar also remains under pressure after the RBA decision this week.
The euro is lower for the sixth day in a row as the market prices in more and more ECB rate cuts. Next week's meeting will likely emphasize data dependence but there's a clear pattern of lower growth and lower inflation in the recent numbers so the risk is that Lagarde opens the door to cuts.