Article Highlights

  • German factory orders m/m: -7.4% vs. 5.5% expected, 5.2% previous
  • French government budget balance: -€5.4B vs. -€69.0B previous
  • Halifax U.K. HPI m/m: 0.1% vs. 0.4% expected, -1.1% previous
  • Euro Zone final Q4 GDP q/q: unchanged at 0.4% as expected
  • Euro Zone final Q4 GDP y/y: unchanged at 1.7% as expected
  • U.S. and Canadian trade reports coming up
  • Brexit Bill debates at the House of Lords currently underway
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Another relatively quiet morning London session today. Although the Greenback did score small victories against its rivals while sterling felt some bearish pressure. Interestingly enough, the biggest mover was the Swissy since it lost ground to ALL its peers, despite the risk-off vibes.

Major Events/Reports:

Commodities retreat, but oil advancesCommodities sold off yet again during today’s morning London session. This time, however, oil was the one going against the tide, since it recovered from its earlier losses.

Based metals got dumped yet again.

  • Copper was down by 0.60% to $2.636 per pound
  • Nickel was down by 1.02% to $10,965.00 per dry metric ton

Meanwhile, the risk-off vibes couldn’t save precious metals from dipping.

  • Gold was down by 0.12% to $1,224.05 per troy ounce
  • Silver was down by 0.20% to $17.737 per troy ounce

Oil benchmarks recovered from their earlier losses.

  • U.S. crude oil was up by 0.39% to $53.41 per barrel
  • Brent crude oil was up by 0.32% to $56.19 per barrel

The second day of falling commodity prices was likely due to the Greenback’s strength. And for reference, the U.S. dollar index was up by 0.12% to 101.79 for the day when the session ended. Although a market analyst also blamed the hard slump in base metal prices on the higher inventory levels for some base metals.

As for oil’s strength, market analysts pointed to technicals and profit-taking as oil prices remain range-bound ahead of U.S. oil inventory data.

Skittishness in Europe – European equity indices were mixed, but mostly (albeit only slightly) in the red during today’s morning London session.

  • The pan-European FTSEurofirst 300 was down by 0.19% to 1,470.14
  • Germany’s DAX was up by 0.04% to 11,963.50 but off its session high of 11,990.50
  • The blue-chip Euro Stoxx 50 was down by 0.12% to 3,384.00

U.S. equity futures were also slightly in the red.

  • S&P 500 futures were down by 0.17% to2,371.50
  • Nasdaq futures were down by 0.14% to 5,353.38

Market analysts blamed the skittish risk sentiment on lingering worries over Deutsche Bank and poor corporate earnings reports.

Major Market Movers:

CHF – Risk aversion was the more dominant sentiment during today’s morning London session. However, the safe-haven Swissy ended up being the weakest currency of the session. There was no apparent reason for this wonky price action. Hmm. Perhaps the SNB is sneakily weakening the Swissy again?

But then again, the SNB did release a report earlier. And the said report shows that the SNB’s foreign currency reserves rose from CHF 643.94B to CHF 668.18B, which market players probably took as a sign that the SNB has sneakily been intervening in the forex market.

USD/CHF was up by 37 pips (+0.37%) to 1.0150, EUR/CHF was up by 12 pips (+0.12%) to 1.0728, GBP/CHF was up by 15 pips (+0.13%) to 1.2375

USD – Overall price action was kinda choppy, but the Greenback did emerge as the top dog of the session. There were no direct catalysts for the Greenback’s strength. Although some market analysts attributed the dollar’s strength to preemptive positioning ahead of U.S. trade data later.

EUR/USD was down by 27 pips (-0.26%) to 1.0569, AUD/USD was down by 15 pips (-0.19%) to 0.7595, NZD/USD was down by 10 pips (-0.14%) to 0.6982

GBP – The pound was the second weakest currency after the Swissy. In fact, the pound has been steadily yet broadly sliding lower since the Asian session. There were no apparent catalysts, but some market analyst point to jitters over today’s ongoing Brexit Bill debate in the House of Lords.

GBP/USD was down by 31 pips (-0.25%) to 1.2193, GBP/CAD was down by 14 pips (-0.10%) to 1.6351, GBP/JPY was down by 17 pips (-0.12%) to 138.99

Watch Out For:

  • 1:30 pm GMT: U.S. trade balance (-$47.0B expected, -$44.3B previous )
  • 1:30 pm GMT: Canada’s trade balance ($0.2B expected, $0.9B previous)
  • 3:00 pm GMT: Canada’s Ivey PMI reading (58.9 expected, 57.2 previous)
  • 8:00 pm GMT: U.S. consumer credit ($19.00B expected, $14.16B previous)
  • 9:45 pm GMT: New Zealand’s quarterly manufacturing sales (0.4% previous)
  • Dairy auction currently underway (-3.2% previous); auction usually ends at around 2:00 pm GMT

See also:

Asian Session Recap 
U.S. Session Recap

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