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The dollar extended its recovery on a bit of risk aversion in the markets. Meanwhile, the Aussie and Kiwi were dragged lower after Australia printed weaker than expected.

  • New Zealand ANZ commodity prices dips by 0.06% vs. 2.4% decline in October
  • Australia’s AIG services index jumps from 51.1 to 55.1 in November
  • Australia’s GDP widely misses with 0.3% growth vs. 0.6% expected, 0.9% uptick in Q2 2018
  • China’s Caixin services PMI higher from 50.8 to 53.8 in November
  • BOJ’s Wakatabe: Risks to Japan’s economic outlook tilting towards the downside
  • Wakatabe: BOJ to seek accelerated inflation by continuing large-scale easing

Major Events/Reports:

Australia’s GDP miss

The Australian economy only grew by 2.8% from a year ago in Q3 2018, which is weaker than the expected 3.3% uptick. That’s the weakest since Q4 2017, yo!

And if that’s not enough to spook investors, Q2 2018’s growth was also downwardly revised from 3.4% to 3.1. Yipes!

On a quarterly basis, the economy had grown by 0.3% during the quarter after seeing a 0.9% increase in Q2 and amidst expectations of a 0.6% expansion.

A closer look tells us that final consumption expenditure was the biggest contributor, while net trade made NO contributions and non-dwelling construction actually dragged on the economy.

Household spending was the biggest surprise, as it slowed down from 0.9% to 0.3% in Q3. Remember that the Reserve Bank of Australia (RBA) is expecting a 3.0% annualized growth rate for consumption in 2019 and 2020. Analysts point out that workers would need a much faster income growth rate to meet the RBA’s expectations.

More risk aversion

Asian session market players took cues from their Wall Street counterparts and traded lower amidst renewed jitters over the U.S.-China trade war.

While we didn’t see escalation in hostilities over the weekend, market geeks now want more deets on the truce that Trump and Xi had agreed on.

For starters, we could know more about details like the exact goods that China will buy; the “structural changes” that it will make, or whether or not China will really remove tariffs on U.S. car imports as Trump had promised last Sunday.

  • Nikkei is down by 0.74% to 21,873.9
  • A SX 200 is up by 0.07% to 5,660.6
  • Shanghai index is down by 0.21% to 2,660.246
  • Hang Seng is down by 1.54% to 26,840.0

Commodities were also hit, with gold dragged by a bit of dollar strength while a U.S. inventories report highlighted oil glut concerns for the Black Crack market.

  • Gold is down by 0.27% to $1,234.91
  • Brent crude oil is down by 0.78% to $60.86
  • U.S. WTI is down by 0.63% to $52.24

Major Market Mover(s):


Traders were shook by Australia’s GDP miss, enough for them to drag Aussie against all of its major counterparts and take the shine off the Kiwi’s recent gains with it.

AUD/USD is down by 46 pips (-0.63%) to .7291; AUD/JPY is down by 40 pips (-0.48%) to 82.35; EUR/AUD is up by 83 pips (+0.54%) to 1.5539; GBP/AUD is up by 101 pips (+0.58%) to 1.7423; AUD/NZD is down by 39 pips (-0.37%) to 1.0550, and AUD/CHF is down by 34 pips (-0.46%) to .7285.

NZD/USD is down by 18 pips (-0.26%) to .6911; NZD/JPY is down by 8 pips (-0.10%) to 78.0; NZD/CHF is down by 6 pips (-0.08%) to .6904; GBP/NZD is up by 36 pips (+0.20%) to 1.8382, and EUR/NZD is up by 25 pips (+0.15%) to 1.6394.


A bit of risk aversion and traders taking profits from their “yield inversion = recession” trades kept the dollar supported against its major counterparts.

USD/JPY is up by 17 pips (+0.15%) to 112.95; USD/CHF is up by 18 pips (+0.18%) to .9991; GBP/USD is down by 10 pips (-0.08%) to 1.2704; EUR/USD is down by 12 pips (-0.10%) to 1.1330, and USD/CAD is up by 21 pips (+0.16%) to 1.3282.

Watch Out For:

  • 8:15 am GMT: Spain’s services PMI (53.9 expected, 54.0 previous)
  • 8:30 am GMT: ECB head honcho Draghi to give a speech in Frankfurt
  • 8:45 am GMT: Italy’s services PMI (49.2 expected and previous)
  • 8:50 am GMT: France’s final services PMI expected to maintain 55.0 reading
  • 8:55 am GMT: Germany’s final services PMI to remain at 53.3?
  • 9:00 am GMT: No changes expected from Euro Zone’s final services PMI (53.1)
  • 9:30 am GMT: U.K.’s services PMI (52.5 expected, 52.2 previous)
  • 9:30 am GMT: BOC FPC meeting minutes
  • 10:00 am GMT: Euro Zone’s retail sales (0.2% expected, 0.0% previous)