FX Morning Colour: Nzd and Aud extend recovery gains vs Greenback


The Kiwi continues to outperform its G10 peers, with Nzd/Usd forming a firmer base above 0.6900 and the rebound on less dovish RBNZ expectations pushing the pair just over 0.6950 at one stage. Cross-winds also helping the Kiwi to outpace its Aussie counterpart as Aud/Nzd slips further below 1.0900 and towards the key 200DMA tech zone between 1.0829-25. However, Aud/Usd also looking more constructive just above 0.7550 and now targeting 0.7570.


A sharp reversal and retreat in Eur/Sek on the back of Swedish inflation data beats with CPI at 1.9% y/y in November vs 1.7% expected and last, while the Riksbank’s targeted CPIF index came in at 2% against the 1.8% forecast and the same previously. Eur/Sek down to almost 9.9300 post-data from around 10.0300 pre-release, but off the lows as attention switches to the Central Bank’s last policy meeting of the year next week.


All a tad firmer vs the Dollar, as the DXY struggles to stay within touching distance of the 94.000 level into day 1 of the December FOMC. Eur/Usd, Usd/Jpy and Gbp/Usd all relatively rangebound however, between 1.1765-90, 113.35-60 and 1.3335-65 approximately. Sterling looking at UK inflation data for independent direction, and also aware of some option interest in Cable at 1.3350 (circa 425 mn). For Eur/Usd nothing large in terms of expiries sub-1.1800, but some hefty options roll off on Friday at 1.1700 and 1.1800 (2.3 bn each). Turning to Usd/jpy, a spread of small expiries ranging from 113.15-25 to 113.45-50, but also just over 400 mn in Eur/Jpy at 133.75 vs the current 133.64 spot price and at the top of the range (down to 133.48) today.


Only minor support for the Loonie from the latest spike in crude prices (mainly on Brent supply disruptions), with Usd/Cad holding above 1.2800.

12 Dec 2017 - 09:18- Forex- Source: ransquawk

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