Intraday Market Thoughts

Cameron Tips Hand on UK GDP, Latest Premium Insights

by Adam Button
Oct 25, 2012 0:09

The FOMC maintained a steady hand as expected on Wednesday. The Australian dollar was the best performer while the euro lagged after Draghi mentioned deflation. The RBNZ held rates in the only event on the Asia-Pacific calendar. Wednesdays release of the Premium Insights include new trades on EURUSD, USDJPY, EURJPY and much more. See link below.

Expectations were low for policy changes and the Fed managed to meet them. The FOMC statement featured only the slightest changes in language referring to soft business spending, a better outlook for consumer spending and slightly higher inflation.

Before the meeting, there was talk the Fed may remove its mid-2015 calendar guidance in favor of goals tied to economic performance but that did not come to pass. The next meeting is Dec 12, where the Fed will decide what to do when Operation Twist expires.

Markets were choppy in US trading. The pound climbed near 1.6050 after UK PM Cameron hinted that Thursdays GDP numbers will be strong. The euro rose on more talk that Greece will get more time to implement austerity policies but slipped after Draghi said deflation is a bigger risk than inflation.

USD/CAD rose after BOC governor Carney said the case for raising interest rates was less imminent.

Early in Asia-Pacific trading, the New Zealand dollar rallied after new RBNZ governor Wheeler left rates at 2.50%, as expected. There was speculation he may shift toward a dovish stance but there was no hint of lower rates.

The yen was virtually unchanged but Kyodo reported that the government is considering a 400B yen stimulus package. The September corporate service price index is the lone item on the calendar, at 2350 GMT.

Wednesdays Premium trade include 2 new on EURUSD, 1 new on USDJPY, 2 new on CADJPY, 1 new on AUDUSD, 1 new on EURJPY, 1 new on cable, 1 new on EURGBP, and 1 new on gold. For direct access to these Premium trades, please click here: Non subscribers, can click on here to join:



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