Asian equities are trading positive after the somewhat mixed lead from Wall Street after a dovish FOMC and Bank of England. However, JPY has caught a soft bid and gained against all of its G10 FX peers. Markets seem to build momentum for some demand for safe-haven currencies ahead of the upcoming jobs United States Nonfarm Payrolls data later in the day. Worth noting that U.S. S&P 500 futures are trading in the red, which could drag the sentiment for risk assets during today’s session.
On the Central Banks front, another dovish signal came from the Reserve Bank of Australia. Its statement on Monetary Policy said they are committed to keeping highly supportive monetary conditions and will act if worsening health outcomes impact the economic outlook. It also reiterates that it is prepared to be patient. Muted reaction is seen immediately following the release. Nevertheless, AUD/USD is trading lower. For the session ahead, traders will be positioning for the major risk event of the day. The U.S. Nonfarm Payrolls, U.S. primary fixed-income dealers, are expecting a headline at 450k. The data pack could signal those seasonal factors are set to press down the reading, but these adjustment effects should not be as severe in October as in September. With a recent dovish backdrop from the FOMC, traders will likely keep a close eye on U.S. equities and real/nominal yields dynamics between the front and back-end of the U.S. curve.
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© 2019 High Leverage FX - All Rights Reserved.