Image Source: PixabayGlobal Macro and Markets
Despite yields declining, EURUSD moved lower yesterday, reaching 1.0664 before bouncing back to just below the 1.07 mark. The AUD is all the way back to 0.6430 from just below 0.65 the previous day. Cable has slid back to 1.2292 from about 1.2380 this time yesterday, and the JPY is back above 150. The rest of the Asian FX pack was largely weaker against the USD on Tuesday. The KRW gave back some of its recent gains, rising back to 1308, and followed closely by the IDR and MYR. USDCNY is fairly stable at about 7.28. US stock markets made small gains yesterday. The S&P 500 rose 0.28%, while the NASDAQ rose 0.9%. Equity futures are not giving much of a directional steer about today’s open. Chinese stocks were down yesterday, possibly responding to the shrinking trade surplus, though there were potentially more positive spots of light in that data set (see also here for our take).
This afternoon, data on Korean bank lending to households will be announced. We expect this to show an increase with the recent revival of jeonse and property prices. Authorities have tightened some mortgage rules since September to curb the rapid increase in household debt, so the pace of growth is expected to decelerate. The BoK is closely watching household debt as a major risk factor, and if debt grows faster than anticipated, the BoK’s hawkish comments will likely strengthen.
What to look out for: Fed speakers
South Korea BoP current account balance (8 November)
Japan leading index (8 November)
US wholesale inventories and MBA mortgage applications (8 November)
Fed Chair Powell and Fed official Cook speak (8 November)
Japan BoP current account balance (9 November)
China CPI inflation (9 November)
Philippines 3Q GDP (9 November)
US initial jobless claims (9 November)
US University of Michigan sentiment (10 November)
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