The dollar will hold firmer in the new week, with more negative overnight risk sentiment controlling other major currencies. USD/JPY was a small mover as it climbed back above 151.00, helped by higher Treasury yields. The pair continues to hold on, stuck between its 100- and 200-day moving averages at 148.63 and 151.96 respectively.
For today, the antipodeans are the biggest movers with the aussie leading the way down. That comes after the RBA lowered its policy guidance stance and may open the door to an earlier rate cut next year. Traders are now pricing in ~57% of a 25 bps rate cut in February next year.
That sees AUD/USD wipe out gains from yesterday following China's rise, with the pair now pinned below 0.6400 and testing key support as mentioned here.
Looking ahead to the session ahead, there won't be much to shake things up for wider markets. The focus now shifts to tomorrow's US CPI report. And until then, it's likely to be a waiting game before market players turn their attention to more central bank meetings in the coming week.
The focus will be on the loonie with the BOC set to cut rates by 50 bps tomorrow as well. USD/CAD is currently holding at 1.4177 and is eyeing a major monthly jump above 1.4100, which will mark a major technical break for the pair as previously indicated. here.
The only notable item on the table in Europe is the German CPI data but even then, these are final estimates so they won't matter.
0700 GMT – Final German CPI figures for November
1100 GMT – US NFIB Small Business Optimism Index for November
That's all for the next session. I wish you a great day ahead and good luck with your business! Stay safe out there.
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