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The US dollar’s reign of terror continued overnight following remarks from both ECB Chairman Mario Draghi and the RBA’s Stevens and news of a possible shakeup among China’s elite. Key downside levels were taken out in EUR/USD following comments made by Mr. Draghi that the ECB remains committed to using unconventional measures (see QE) at next week’s policy meeting. Global stocks remained slightly positive on those comments as Chinese leader Xi also remarked that he is considering replacing PBoC Governor Xiaochuan as part of a wider personnel shuffle amid rumors of internal battles over economic overhauls.

In Australia, Governor Stevens was quoted as making comments about Australia’s bubbly housing market stating that the RBA is open to using “macro-prudential tools”. The Australian dollar was a big loser on these comments as AUD/USD was hit twice following Mr. Stevens remarks and instability among China’s leaders. Data was limited in Asia and Europe with only EU private loans garnering any headline, dipping by 1.5% over this same period last year. But it was the speakers that won the day. Federal Reserve Member Fisher was quoted again calling for a Fed rate hike sooner rather than later and warned that extreme risk taking in junk bond markets is starting to be seen.

Looking to North America, weekly US jobless claims and August durable goods orders were released this morning, both of which had absolutely no impact on markets. Despite the across the board Dollar strength today, the CAD is putting up a good fight following (you guessed it) comments made yesterday by BoC deputy governor Lane. Mr. Lane expressed concern about the Fed’s reduction in bond buying and eventual rate hikes and how that might affect the Canadian economy. While Mr. Lane seemed more open to CAD weakness, he added that the Fed’s impact would only be partly offset by the resultant downward pressure on the Loonie.

As has been the case for much of the week, FX markets are resigned to headline watching as mostly second tier Japanese data separates everyone from the weekend. Next week markets will have the much anticipated ECB meeting and US non-farm payrolls report on Thursday and Friday, respectively. Not to be forgotten, the New Zealand dollar slumped to a 12-month low as the nation’s central bank signaled possible intervention, labeling the kiwi’s level “unjustified”. In the Arab world, the US and its allies continue to drop what seems like a year’s worth of missiles over the span of a few days. For now, markets seem to be content ignoring the ISIS crisis as well as the UN General Assembly taking place in New York.

Further reading:

EUR/USD collapses to 22 month low – no sign of recovery

Dollar storm: EUR/USD approaching double bottom, AUD/USD at key support, NZD/USD below 0.80