Trump Tramples On Risk Appetite

Dollar Down Following Trump Comments

The US dollar has been lower over the European morning session so far on Wednesday as traders await the next key US data reading. October CPI will be released later today and will be closely watched by traders. On the back of recent data beats, a positive number could see USD upside reignited while any weakness could see a drop lower. USD index trades 98.16 as of writing.

EUR Rises on Weak USD

EURUSD has enjoyed some mild upside so far today as a result of the weaker US dollar though remains at the bottom of recent declines, trading 1.1014 last. The recent sell-off has seen price breaking back under the 1.1024 level and for now, the near term outlook remains bearish.

UK CPI Hits Three Year Lows

GBPUSD has had a volatile session so far today, making moves in both directions. UK CPI released this morning showed inflation hitting three-year lows at just 1.5% in October.  The data adds to the uncertain environment in the face of a further Brexit delay and puts focus back on possible BOE easing. GBPUSD trades 1.2844 last.

Risk Appetite Weaker

Risk assets have had a weaker start to the day with the SPX500 softening from recent highs to trade 3079.68 last. Speaking at the Economic Club of New York yesterday, Trump disappointed traders as he failed to offer any new insight on US/China trade talks ahead of the potential signing of a deal this weekend.

JPY & Gold Higher

Safe havens have been firmer this morning with both JPY and gold rising against USD in light of the pull-back in equities.  US data later today could see further gains if any weakness materialises. XAUUSD trades 1465.03 last, recovering off yesterday’s lows. USDJPY trades 108.90 last, sitting just off yesterday’s lows.

Crude Lower, EIA on Watch

Oil prices have been lower again today on the back of Trump’s comments yesterday (or lack of) which have raised uncertainty around the prospect of a US/China trade deal being agreed this weekend. Looking ahead today, traders are waiting on the weekly EIA report for the latest update on US crude inventory levels. Crude trades 56.35 last.

Loonie Eyeing Next Resistance

USDCAD has been a little softer today, retreating from yesterday’s highs as of writing. However, the move above 1.3207 has been firm and focus remains on further upside with the 1.33 level the next topside marker to watch. US CPI data later today could provide the catalyst for such a move if we see any upside surprise.

Aussie Lower on Trade Deal Uncertainty

AUDUSD has been sharply lower today as European traders sell the Aussie as a play on China. While traders have not yet ruled out a trade deal being agreed at the APEC meeting this weekend, there is certainly an air of caution being noted today. On the data front, Aussie employment data overnight tonight will be the next key driver for AUDUSD which trades .6827 last.