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Currency Market Analysis

Jan 14, 2020 | Currency Market Analysis

Global Themes

USD lower as US stocks make new all-time highs

The US dollar and Japanese yen were both weaker overnight as US stocks continued to extend their recent gains.

US – and global – shares have been on a tear recently with the Dow Jones up 13% since mid-October and the technology-focused Nasdaq up an incredible 22% in the same time.

The Japanese yen fell to the lowest level since April.

CNH gains

The Chinese yuan was strongly higher after the US Treasury reports signalled the US government would no longer label China a currency manipulator.

The SGDCNH fell to the lowest level since August.

The British pound fell after a weaker UK GDP reading. December-quarter GDP fell by 0.3% versus expectations for a flat result.

Trade deal

In the near term, focus is likely to shift back to the US-China trade deal, with "phase one" due to be signed tomorrow night.

The Chinese delegation is reported to have arrived in Washington overnight.

In terms of data, tonight US inflation number can drive USD action.

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