Traders Waiting On ECB

USD Higher Ahead of Key Data

The US dollar has been firmer over the European morning today with the USD index continuing to recover off the recently tested 96.99 level to trade 97.24 last. Over the US session today, traders will receive Durable Goods data and the flash manufacturing PMI reading for October. The PMI reading will be closely watched. This is given the two prior months of negative readings which have raised grave concerns over the health of the US economy.

EUR Lower on Data Miss – ECB Up Next

EURUSD has seen a heavy reversal over the session so far, conceding initial gains on a raft of weak data this morning. Eurozone manufacturing PMI was seen unchanged at 45.7 over October, staying at cycle lows. German PMI data sets were equally disappointing with manufacturing remaining in negative territory also.

Today focus will be on the ECB meeting and though the bank is not expected to adjust policy, given continued data weakness, traders will be keen to get the latest outlook. EURUSD is now once again testing the 1.1127 level from above.

GBP Lower As UK Awaits Brexit Delay Decision

GBPUSD has been lower against USD today. The latest on Brexit is that the EU is yet to give a decision on the UK’s Article 50 extension request. They are however expected to approve it. The UK PM is now pushing for a general election in December ahead of what would be the new Brexit deadline of January 31^st 2020. GBPUSD trades 1.2829 last, capped by the 1.3033 level so far this week.

Risk Outlook Remains Favourable

Risk assets have had a quiet session so far with SPX500 sitting at 3008.03, broadly unchanged on the session. With Brexit likely to be delayed again and with US/China trade talks progressing, there is a better risk backdrop at the moment. This means further upside in equities is likely.

Safe Havens Muted

Safe havens have been quiet today also, given the limited moves in risk assets. Gold and the Japanese yen are both fairly even against USD so far today. However, US data later today could see some upside moves in safe havens if we get further data weakness. USDJPY trades 108.66 last, still capped by 108.84 for now. XAUUSD trades 1489.43 last, still clinging to 1481.93 support for now.

Crude Rallies on Bullish EIA Report

Oil prices have been a little softer so far today though are higher on the week as the EIA reported an unexpected drop in US crude stores last week. The move has been attributed to the sharp fall in US crude imports and puts an end to the five weeks of inventory build-up seen recently. Crude trades 55.60 last, sitting above the 55 level once again.

Loonie Higher

USDCAD has been higher today. This is given the stronger USD and weakness seen in oil prices over the session so far today. USDCAD trades 1.3082 last, having recovered yet again off the 1.3068 level which remains the key support level to watch.

AUD Down On Data Miss

AUDUSD has been sharply lower today following the release of PMI data sets overnight. This saw all sectors barely remaining in positive territory over the month and each having declined from the prior month’s levels. AUDUSD trades .6827 last having fallen back below the .6850 level on the latest decline.