Global Markets:

  • Australia AIG Construction Index: 46.7, Previous: 45.9
  • Asian stock markets: Nikkei up 0.10 %, Shanghai Composite lost 0.60 %, Hang Seng down 0.40 %, ASX gained 0.50 %
  • Commodities: Gold at $1254, Silver at $19.08, Crude Oil at $102.50
  • Bonds: US 10 year yield at 2.58

FX Update:

  • EUR – The ECB has cut rates as expected with the refi rate now at 0.15 % (previously at 0.25 %), main refinancing rate at 0.40 % (prev. 0.60 %) and the depo rate now in negative territory at -0.10 % (prev. 0.00 %). Shortly after the Draghi press conference began, EUR/USD fell to a low of 1.3503 amid heavy selling from specs, but an Asian reserve manager was bidding the pair ahead of the 1.35 barrier option, which capped the downside. Draghi mentioned that the ECB has discussed a ABS buying progamme, but a big reversal in EUR/USD occured as it became apparent that QE was not coming soon. Flows in the Asian session were very light as traders are now waiting for US employment data. There are also several large option expiries for today’s NY cut (10:00 AM EST). Data from DTCC shows a $1.2 billion expiry at 1.35, $1.1 billion at 1.3550, $3.5 billion at 1.36 and $1.5 billion at 1.3650.
  • JPY – USD/JPY stayed relatively quiet yesterday and flows were mixed with some specs scaling down their long positions as we’ve failed to breach the 102.80 level and other using the opportunity to buy into the dip. Bids are said to be solid at 102.20 and there are stops from short-term names through 102.15. To the topside, still decent selling interest pre-103.00, but liquidity will become thin towards the NFP release.

Upcoming Events:

  • 06:00 GMT – German Industrial Production (0.4 % MoM)
  • 06:00 GMT – German Trade Balance (15.2B)
  • 07:15 GMT – Swiss CPI (0.2 % MoM, 0.1 % YoY)
  • 08:30 GMT – UK Trade Balance (-8.65B)
  • 12:30 GMT – Canadian Employment Change (12.3k)
  • 12:30 GMT – Canadian Unemployment Rate (6.9 %)
  • 12:30 GMT – US Nonfarm Payrolls (215k)
  • 12:30 GMT – US Unemployment Rate (6.4 %)