Asian markets are set to start the day on the back foot after the US session saw the major equity indices finish up in the red. Currencies saw some whipsaw volatility as President Trump turned his attention to his own central bank commenting that he wasn’t thrilled with the Fed raising rates. Then in what now appears to be standard practice after presidential comments, we saw a turn around as the White House issued a statement saying the president respects the central banks independence.
Aside from moves on the back of Trump comments, we saw a key break to the topside in the UsdCny over night as it broke comprehensively above the 6.7000 level that it’s been trading around for the last week or so. It’s trading up at 6.7750 as the Asian session gets started and investors will be watching closely to see if the PBoC is happy to allow the currency to continue to depreciate over the coming sessions.
Sterling has had a rough week with most of the data we’ve seen coming out south of expectation, last night it was Retail Sales that disappointed and rallies will be capped in the short term, although still expect any fresh news on Brexit to dominate sentiment as we move forward.
Looking ahead to today’s trading and it’s very light in terms of fundamental economic data releases through both the Asian and London sessions today and we have just the Canadian CPI and Retail Sales numbers to focus on in the New York session. Therefore, investors will be looking at the news wires for any change in sentiment or catalysts to start fresh market moves.