Forex news for North American trade on January 15, 2020:
- US Dec advance retail sales -1.4% vs 0.0% expected
- Jan prelim U Mich consumer sentiment 79.2 vs 79.5 exp
- US December industrial production +1.6% vs +0.5% expected
- Canada December existing home sales +7.2 m/m vs +6.0% expected
- US January Empire Fed +3.5 vs +6.0 expected
- US PPI final demand for December YoY +0.8% vs. 0.8% estimate
- Fed's Rosengren on CNBC: Biden's $1.9 trillion package was big but appropriate
- Baker Hughes oil rigs rise to 287 from 275 last week.
- Fed's Kashkari: Vaccine news has been a positive surprise
- US business inventories for November 0.5% vs. 0.5% estimate
- CFTC commitments of traders: EUR longs move back up to December highs
Markets:
- Gold down $21 to $1826
- US 10-year yields down 4 bps to 1.09%
- WTI crude down $1.43 to $52.14
- S&P 500 down 27 points to 3768
- USD leads, NZD lags
There was a decided risk off tone in markets and that meant a bid in the US dollar even as Treasury yields slid. It was a classic 'sell the fact' move after Biden's big stimulus plan, something I warned about.
Midway through the day, commodity currencies and risk assets tried to stage a rally and they made some headway before the selling returned later.
The economic data was a reminder of how much the government is supporting consumption as retail sales missed badly. There were also reminders of inflation pressures in the PPI and U Mich data, but the bond market appears to be moving on from that theme.
There wasn't much political fallout from the Biden plan with few Senators speaking for or against it. Take that as a good sign for Biden but the market wasn't in that kind of mood, perhaps with the long weekend taking away some of the positive sentiment.
Tune in for the Chinese data on the weekend and a thin session on Monday.
