Forex headlines for January 21, 2014:
- IMF hikes global growth forecast
- IMF raises US growth forecast to 2.8% from 2.6%
- IMF sees 10-20% chance of deflation in the eurozone – Blanchard
- Canadian Nov wholesale sales 0.0% vs +0.3% exp
- Canadian Nov manufacturing sales +1.0% vs +0.3% exp
- Greece’s funding gap could be larger than expected
- London Gold fix set for an overhaul
- Gold down $13 to $1242
- WTI crude up 62-cents to $94.99 at contract expiration
- S&P 500 up 5 points to 1844
- GBP leads, CAD lags
For the second time in 2014, a snowstorm zapped New York trading of any punch. Parts of the city will be hit by 14 inches of snow and that sent many traders’ minds elsewhere. At the time of the first snowstorm of the year from Jan 2-4, stocks slumped but they later recovered. Today stocks bounced around but finish the day solidly higher.
In general, the theme was US dollar weakness. Cable dipped to 1.6400 and then ripped to 1.6486 at the start of US trading. A small retracement hit but we remain near the highs.
The euro also rode on the anti-dollar train as it climbed to 1.3569 but failed to break back above the 100dma that broke on Friday. Last at 1.558.
USD/JPY came under pressure in the early going as US stocks lost altitude. The pair slipped to 104.03 from 104.70 but the big figure held and the pair rebounded back to 104.34.
USD/CAD broke 1.10 to a fresh cycle high ahead of US trading but it couldn’t press the advantage as traders squared up ahead of tomorrow’s Bank of Canada decision. Last at 1.0975.
Gold spilled lower on signs of progress in South African union negotiations, hitting $1235 but we’ve had a modest recovery to $1242.
