Forex Analysis for Thursday 8th December 2016
The Canadian overnight rate remained unchanged as per expectation at 0.50%. In the UK, MPs backed PM May’s plan to trigger Article 50 by end March 2017. BoJ’s ETF purchasing seen boosting Nikkei 225 to over 21,000 level by end of next year, according to FT. New Zealand Treasury stated if the budget improves, there is scope for income tax cuts and faster debt repayments, while it also raised FY16/17 GDP target to 3.5% from 3.3% and FY17/18 target to 3.4% from 3.0%. (Newswires) New Zealand Finance Minister Bill English is set to be confirmed as the next Prime Minister after rivals conceded (Newswires). RBNZ Gov Wheeler indicates the bank is probably finished with its rate cutting cycle.
The USD index continues to consolidate with a slight downwards trend. Global stocks rally before today’s ECB meeting. WTI consolidates around USD50/bbl. On the currency markets, the JPY consolidates along with the USD. The GBP takes a hit on poor Manufacturing Production data. CAD consolidates along with WTI. The NZD strengthens on news that the rate cutting cycle is probably over.
ECB Minimum Bid Rate and Press Conference (news of a continuation of QE beyond March 2017 is expected. News of when QE will end is also anticipated).
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