Risk Sentiment And Gold Come Roaring Back

Daily Forex Fundamentals | Written by AC-Markets | Nov 25 09 08:28 GMT |

Market Brief Risk appetite came back in a big way during the Asian session, as events in the US session were supportive of long risk positions. The FOMC minutes really contained no surprises, but stayed dovish despite going divergence among members. The minutes also addressed the USD decline, which said that so far the deprecation had been orderly, which the market quickly read into as permission to continue to sell the USD. The economic data yesterday were mixed, with German IFO and US consumer confidence data surprising to the upside while GDP data basically printing inline with expectations. The rally in risk correlated trades saw Spot Gold rise to $1180.00, while EURUSD is now trading slightly above the 1.5000 handle. The GBPUSD jumped nearly a figure in late Asian trading to 1.6668 from 1.6580. Yet, GBPJPY gains were compressed, as JPY fueled carry trade felt the brunt of JPY buying. In Japan, exports grew in October for the third straight month thanks to robust shipments to Asia, illustrating that a sturdy recovery in the region will prop up Japans export-driven economy for the rest of this year. AUDUSD climbed to 0.9267, as construction work done data released this morning surprised the market to the upside rising by 2.2% q/q in Q3 (consensus 0.0%). This economic release helped confirm the RBA's bullish outlook for the economy, which was reiterated by RBA Deputy Governor Battellino this morning and supports our view that the central bank will raise the cash rate by 25bp in December. For this light calendar, pre-Thanksgiving Day markets will be watching economic data from the US . Today in the US, October's personal income and spending figures are expected to offer further clues that the pace at which real consumption grew in Q3 is not sustainable. And finally, the latest data core durable goods suggest that the growth rate of orders has already peaked and will falter in the near term. ACM FOREX Disclaimer: This report has been prepared by AC Markets (thereof ACM) and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Salesperson or Traders of ACM at any given time. ACM is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.