AccuTrade2000

AccuTrade2000

- The DXY dollar index is softer, primarily influenced by developments in Japan. - Japanese investors observe minimal official resistance to rising JGB yields, signaling a potential BOJ rate hike in the summer. - The OIS market suggests a 21bp hike in July, raising the policy rate to 0.75%. - The yen has strengthened unexpectedly despite modest interest rate...

AccuTrade2000

- The euro is weakening due to geopolitical developments and increased European defense spending. - US isolationism is prompting Europe to boost defense budgets significantly. - Debate exists on financing: whether it will be at a European supranational level or through local/national budgets. - Italy, with a high debt-to-GDP ratio (~140%), may face significant...

AccuTrade2000

The standout move in overnight FX markets has been the drop in USD/JPY close to 150 as traders get excited about another hike from the Bank of Japan. Expect USD/JPY to stay offered today before tomorrow's January CPI data release. Elsewhere, we think a new fiscal risk premium could emerge in the euro as national bond markets take the strain of defence spending

AccuTrade2000

Intraday Short-term Trade set up： Go Short from 158.405 Stop 159.198 TP3: 157.137

AccuTrade2000

Intraday Short-term Trade set up： Go Short from 106.915 Stop 107.406 TP3: 106.06

AccuTrade2000

Intraday Short-term Trade set up： Go Short from 96.426 Stop 96.816 TP3: 95.654

AccuTrade2000

Intraday Short-term Trade set up： Go Short from 151.355 Stop 151.907 TP3: 150.144

AccuTrade2000

With a bank holiday in both Canada and the US yesterday, USD/CAD has consolidated above Friday’s lows of around 1.4150, as the pair broke away from the 1.44 pivot that had prevailed for about two months until last week. The pair nonetheless remains at the mercy of any eventual policy twist from the new US administration, mainly regarding the imposition of tariffs...

AccuTrade2000

The Reserve Bank of Australia cut rates for the first time in four years this morning, matching consensus and market expectations. The 25bp reduction was accompanied by some rather hawkish remarks by Governor Michele Bullock, both in the statement and in the press conference. Bullock seemed to focus on pushing back against the dovish repricing in the AUD curve,...

AccuTrade2000

Our baseline view for this week has been that the dollar correction has run its course, and we still favour chasing a USD rebound against other G10 currencies. There is admittedly some residual room for a risk-on/dollar-off move once a potential Russia-Ukraine peace deal is agreed, but markets are largely pricing it in at this stage and there are no guarantees for...

AccuTrade2000

The ongoing discussion among EU leaders for a joint fund for defence spending is unlikely to drive much support for European currencies. That’s because the trigger is US President Donald Trump’s threat to scale back military support for NATO borders in Europe, which is hardly a net-positive development for local currencies. It is equally far-fetched to hope any...

AccuTrade2000

USD/CAD’s fair value fell from 1.4523 to 1.4420 due to a fall in the USCanada short-term rates spread as well as a rise in global equities, which was partly offset by a rise in the US-Canada box yield spread. USD/CAD remains more than 1.5 standard deviations undervalued. The FAST FX model has triggered a long USD/CAD trade with a stop-loss of -1.79% and a...

AccuTrade2000

We continue to expect the RBA to start its rate cutting cycle with a hawkish 25bp rate cut on Tuesday. Australian trimmed mean inflation surprised the central bank 20bp to the downside coming out at 3.2% YoY in Q4. On a 6M annualised basis, trimmed mean inflation is running close to the centre of the central bank’s 2-3% target band. Household consumption appears...

AccuTrade2000

The RBNZ has revised its rate cut projections lower multiple times as the economy has cooled faster than expected. This is in stark contrast to the country's nearest neighbour, Australia, which has not yet cut. Across the Tasman Sea, Australia has positive GDP growth and a steady unemployment rate. Sure, they have stickier inflation, but even that is just 0.2%...

AccuTrade2000

The market is pricing in the first 25bp rate cut from the Reserve Bank of Australia (RBA) next week on 18 February. While this is in line with our view and we place a 60% probability to it, we think the decision to cut or pause will be a close one – and it’s therefore not a done deal. Key to our thinking is that the wage pressures have eased more than expected and...

AccuTrade2000

EUR/USD remains offered as the weekend announcement over steel tariffs was the first to hit the EU. Europe is now bracing for other sectors, such as autos, to be tariffed. There is little justification for the EU bloc as a whole to be hit with reciprocal tariffs since the EU tariff regime is relatively low. But, presumably, European politicians are more fearful...

AccuTrade2000

The DXY dollar index is staying relatively bid above 108.00 as markets remain gripped by the tariff threat. 'Reciprocal' tariffs could be due any day and the market remains uncertain whether these would apply only to certain key sectors, such as autos, pharma or semiconductors – or more broadly. US President Donald Trump is supposedly set to sign another batch of...

AccuTrade2000

The repricing of the Fed cycle after the strong US jobs data has seen EUR:USD two-year swap rate differentials widen back out beyond 190bp. We expect those differentials to stay near 200bp for most of the year and to keep EUR/USD under pressure. Equally, Friday's release of the European Central Bank's staff paper into the neutral interest rate had little impact on...