Currency Market Analysis

Feb 21, 2019 | Currency Market Analysis

Global Themes

USD slips as Fed stays cautious

The USD slipped lower overnight as the US Federal Reserve confirmed their more cautious stance in this morning’s Fed minutes.

In the minutes from their 31 January meeting, the Fed signalled that they might not need to raise rates in 2019 and also indicated their balance sheet reduction program could be completed by the end of this year.

Risk sensitive

The news boosted risk sensitive markets like US shares with the SGD helped higher by the improved global sentiment.

The USDSGD fell 0.1% after earlier touching two-week lows.

Other safe havens like the Japanese yen and Swiss franc were both lower.

Aussie jobs

Today’s focus was clearly on the all-important Australian jobs number for January.

With the Reserve Bank of Australia concerned about a recent slowdown in local economic sentiment, today’s employment figures can have a big impact on Australian interest rate expectations.

A better than expected number today added to the AUD’s recent supportive environment.

Additionally, all eyes with be on global PMI numbers that are released over the course of the day. PMI numbers provide an up-to-date reading of activity in manufacturing and services industries.

Japanese PMI numbers were below expectations, with European and US number due later in the day.

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