News & Data:
Asian stock indices are mostly higher this morning, boosted by better than expected Chinese GDP data. The year-on-year figure arrived at 7.3 % vs 7.2 % expected, though the quarter-on-quarter number was 1.5 % against expectations of a 1.7 % print. Gold and Silver remain very well bid, despite the USD regaining some strength in the past 24 hours. The next bull target in Gold is $1344 and key short-term support is now seen in the $1250 area. Meanwhile, both WTI and Brent are again under pressure, declining more than 2 % on the day.
In FX, EUR selling interest remains high. The pair hit a high of 1.1630 in yesterday's NY session, but failed to sustain momentum and quickly fell back sub-1.16. The pair is likely to consolidate ahead of the ECB meeting on Thursday, when the bank is expected by most analysts to introduce a quantitative easing (QE) programme. GBP/USD followed the Euro lower and may test the pivotal 1.50 level soon. The next key event is tomorrow, in form of the Bank of England minutes. We will also see UK employment data for December.
The commodity currencies weakened again in the past two sessions, with AUD/USD falling back below 0.82 and NZD/USD slowly heading towards the lower part of the 0.76-0.7850 range. Dealers reported decent demand for AUD/NZD from leveraged names. A daily close above 1.06 could lead to further short covering in the pair, which certainly does look oversold on the daily chart.