Asian Session Forex Recap – Dec. 1, 2014

  • Swiss voters reject gold initiative in referendum
  • Chinese official manufacturing PMI down from 50.8 to 50.3 in Nov
  • China’s HSBC final manufacturing PMI at 50.0 for Nov
  • Australia’s company operating profits up by 0.2% in Q3
  • Japanese capital spending up by 5.5% in Q3 vs. 2.1% forecast
  • Manufacturing PMI from U.K., Switzerland, Spain and Italy due

Commodity currencies were in free fall at the start of the week, as the latest slide in oil and gold prices weighed on their forex price action. AUD/USD is down 0.80% so far, NZD/USD is down 0.24%, and USD/CAD is up 0.16%.

News that Swiss voters rejected the gold initiative in the referendum held over the weekend led to a sharp selloff for the Swiss franc and gold, along with the positively correlated Australian dollar. Since the proposal hasn’t been approved, the SNB still has room to implement easing measures or intervene in the forex market to defend the franc peg if necessary.

In China, the official manufacturing PMI fell from 50.8 to 50.3 in November, reflecting a slowdown in industry expansion. The HSBC version of the report stood at 50.0 for the month. Australia’s company operating profits saw a stronger than expected 0.2% gain in Q3 but this did very little to support the Aussie.

Japan’s capital spending report boasted of a 5.5% jump for Q3, stronger than the estimated 2.1% forecast. However, yen pairs continued their ascent, with USD/JPY looking at a 0.15% gain and EUR/JPY up 0.13% as of this writing.

Up ahead, we’ve got a slew of manufacturing PMI readings from the U.K., Switzerland, Spain and Italy starting 9:30 am GMT. The Swiss SVME PMI is slated to fall from 55.3 to 52.9, which might lead to more losses for the franc, while the U.K. manufacturing PMI could dip from 53.2 to 53.1 in November. Do watch out for the release of the U.K. net lending to individuals report and mortgage approvals data as well!

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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