Financial Market Review for February 16 2018 UK retail sales in focus this morning, with the Dollar slide continuing through the Asian session, which has seen some of the majors make significant gains this week, with stats out of the U.S unlikely to have an impact this afternoon. Economic data through the Asian session this morning was limited to New Zealand’s Business PMI numbers for January. There was more good news for the Kiwi Dollar bulls, with the PMI rising from 51.2 to 55.6 in January. The New Orders sub-index rebounded from a contracting 49.7 in December to 55.6 in January, with Deliveries also expanding, up from 49.8 to 55.3, with production, employment and finished stocks seeing greater expansion in the month, contributing to the bounce back in the PMI sector. While the PMI number was positive, the proportion of positive comments from manufacturers slid from 63.3% to 50.7% in January, painting a slightly different picture to the PMI numbers, raising some concerns over what lies ahead for the sector. The Kiwi Dollar moved from $0.74014 to $0.74065 upon release of the PMI, before moving to $0.7423, a 0.22% gain for the morning. Elsewhere, the Aussie Dollar continued to move ahead, up 0.31% to $0.797, while the Yen recovered from early losses to gain 0.33% to ¥105.78 against the Dollar, as U.S Dollar continued its slide through the Asian session. In the equity markets, the bounce in the Yen did little to pull back Japanese equities, with the Nikkei up 1.22% at the time of writing, while the ASX200 slipped 0.09% in light trading, with the a number of key Asian markets closed for Chinese New Year. For the EUR, there are no material stats scheduled for release through today’s session, which will turn attention to ECB member commentary, with ECB’s Coeure scheduled to speak this morning. Economic data out of the Eurozone has continued to support a positive outlook for the Eurozone economy, with the narrowing of the Eurozone’s trade surplus with the rest of the world in December offset by intraeuro area trade according to figures released on Thursday. At the time of writing, the EUR was up 0.32% to $1.2535, with upbeat economic data out of the Eurozone, coupled with a stumbling Dollar driving the EUR through the week. Across the Channel, January retail sales figures are scheduled for release out of the UK. Forecasts are for a recovery from the woeful December numbers that would be a positive for the Pound and provide further reason for the BoE to make a sooner rather than later rate hike, though next month’s negotiations on Britain’s transition period out of the EU will be key. At the time of writing, the Pound was up 0.25% to $1.4120, the recovery coming from a particularly soft Dollar and a surprisingly hawkish BoE Governor, with the lack of Brexit talks easing any angst ahead of next month’s negotiations.
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Financial Market Review for February 16 2018 Across the Pond, it’s another heavy day of stats out of the U.S, with January housing sector data, import and export price figures and February’s prelim consumer sentiment numbers scheduled for release. Following another slide in the Dollar in the U.S session that has continued through the Asian session this morning, economic data and sentiment towards monetary policy continues to have a muted impact on the Dollar and, barring exceptional figures this afternoon, a bounce back from today’s losses looks unlikely. At the time of writing, the Dollar Spot Index was down 0.33% to 88.303, with little in the way of support as focus remains on the U.S deficits. For the Loonie, stats include December’s manufacturing sales and foreign security purchases, with the numbers forecasted to be fairly neutral for the Loonie, though further gains could be on the cards later today should the Dollar tumble continue through to the close. At the time of writing, the Loonie was up 0.12% to C$1.2455. In the Equity markets, Asian shares rose for a fifth straight day on Friday as investor confidence slowly returns after a sharp sell-off earlier in the month, while the dollar continued its descent, hitting a threeyear low against a basket of major currencies. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.4 percent, though many Asian markets were closed on Friday for the Lunar New year. Japan’s Nikkei rose 1.2 percent, with investors relieved to see the government appoint Bank of Japan Governor Haruhiko Kuroda for another term, suggesting the central bank will be in no rush to dial back its massive stimulus program. Measured by the MSCI’s broadest gauge of the world’s stocks covering 47 markets, global shares have now reclaimed more than half of the 10.7 percent plunge from a record intraday high on Jan. 29 to a fourmonth intraday low a week ago. Finally, Bitcoin pulls back from a week high $10,300 hit this morning, with all the majors except Bitcoin Cash in the red at the time of writing. The losses are relatively minor however and there is the hope of a Saturday rally to look forward to. View our full economic calendar for a daily roundup of major economic events. It’s been a good week for Bitcoin this week, with Bitcoin seeing just one day of decline Monday through to Thursday, with Tuesday’s 3.2% fall as bad as it got for the crypto. While Monday and Wednesday saw Bitcoin see double digit gains, Thursday’s move through to $10,000 levels was the key move of the week. Bitcoin having languishing at sub-$10,000 levels since the start of the month sell-off that saw Bitcoin fall to sub-$6,000 levels. A lack of regulatory commentary from governments and regulators through the week has certainly eased the negative sentiment towards the crypto markets, with levels through the earlier part of the week having been considered on the attractive side for investors.
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Financial Market Review for February 16 2018 Thursday’s 8% gain to a closing $10,253.41 was an impressive one considering the fact that all of the limelight through the day had been on Litecoin, it’s Sunday fork and the planned roll out of LitePay later this month. Interestingly, news of the Spanish government looking to create a tax haven for cryptocurrencies and blockchain techs had little influence on the crypto market this morning. Spain may not be amongst the largest crypto jurisdictions in the world, but regulatory arbitrage is likely to evolve as certain jurisdictions come down hard on the crypto markets. View our full economic calendar for a daily roundup of major economic events.
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