A sense of calm prevailed in Wednesday’s Asian trading, as the dust settled over the Brexit vote defeat aftermath. The GBP bulls faced exhaustion, leaving the Cable to consolidate the Brexit vote rejection-led rally near 1.2850 levels. The EUR/USD pair also steadied just ahead of the 1.14 handle while the Yen traded on the front foot amid moderate risk-aversion.
The USD/JPY pair got sold-off once again at 108.75, having found some support near 108.50 region amid reports that the BoJ will slash inflation forecasts at its monetary policy meeting next week. Meanwhile, the Antipodeans remained underpinned by further Chinese stimulus plans. The Aussie regained the 0.72 handle and the NZD/USD pair tested higher near 0.6830 heading into Asia’s closing.
Among related markets, both crude benchmarks traded modestly higher while gold futures kept the bid tone intact above 1290 levels. The Asian stocks, on the other hand, traded mixed amid Brexit anxiety and China stimulus talks.
Main Topics in Asia
GBP rallies on Brexit vote, sentiment switches soft
Scotland’s Sturgeon: We cannot waste any more time for a second referendum
UK consumer spending fell by the most in 8 months in December - Visa
China injects record CNY 560 billion via reverse repo operations
China Commerce Ministry: Will further boost consumption this year
Japan’s Suga: Will closely watch movements related to Brexit
Oil continues higher on expectations of China easing, receding US stocks
'Gold'en crossover confirmed, China stimulus plans and Brexit uncertainty could limit downside
Moody's would formally review UK's credit profile in case of no-deal Brexit
Asian stocks trade mixed, Yen gains
Sources: BoJ said to cut inflation outlook next week – Reports
Key Focus Ahead
The EUR, GBP traders brace for yet another eventful session ahead, with the UK December CPI and PPI figures dropping in at 0930 GMT. The headline CPI figure is likely to ease 2.1% in Dec versus 2.3% while the core reading is seen steady at 1.8% y/y in the reported month. Just ahead of the UK inflation report, the Bank of England (BOE) Governor Carney’s testimony on the Financial Stability Report (FSR) will be closely eyed at 0915 GMT. Apart from these two event risks, the second-liner German final CPI data will be published at 0700 GMT.
In the NA session, the UK PM Theresa May’s leadership challenge will headline (scheduled at 1900 GMT) amidst minority housing sector and EIA crude stockpiles data from the US. Also, in focus remains the Fed Beige book release at 1900 GMT alongside PM May’s no-confidence vote.
EUR/USD: downside exposed after bearish outside-day
The path of least resistance in the EUR/USD pair is to the downside. The bearish setup would be negated above the previous day's high of 1.1490.
GBP/USD once again trading near 1.2850 ahead of UK CPI, BoE's Carney
With the long-awaited parliamentary vote finally out of the way, traders will be looking towards an appearance from the Bank of England's Mark Carney at 09:15 GMT today, closely followed by the most notable CPI for December, with the y/y headline figure expected to slip from 2.3% to 2.1%.
May's Brexit deal goes down in flames and the EU is singed
Prime Minister Theresa May lost her bid to bring the ill-fated Brexit deal through the House of Commons by a huge majority of 230 votes.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD extends gains above 1.0700, focus on key US data
EUR/USD meets fresh demand and rises toward 1.0750 in the European session on Thursday. Renewed US Dollar weakness offsets the risk-off market environment, supporting the pair ahead of the key US GDP and PCE inflation data.
USD/JPY keeps pushing higher, eyes 156.00 ahead of US GDP data
USD/JPY keeps breaking into its highest chart territory since June of 1990 early Thursday, recapturing 155.50 for the first time in 34 years as the Japanese Yen remains vulnerable, despite looming intervention risks. The focus shifts to Thursday's US GDP report and the BoJ decision on Friday.
Gold closes below key $2,318 support, US GDP holds the key
Gold price is breathing a sigh of relief early Thursday after testing offers near $2,315 once again. Broad risk-aversion seems to be helping Gold find a floor, as traders refrain from placing any fresh directional bets on the bright metal ahead of the preliminary reading of the US first-quarter GDP due later on Thursday.
Injective price weakness persists despite over 5.9 million INJ tokens burned
Injective price is trading with a bearish bias, stuck in the lower section of the market range. The bearish outlook abounds despite the network's deflationary efforts to pump the price.
Meta takes a guidance slide amidst the battle between yields and earnings
Meta's disappointing outlook cast doubt on whether the market's enthusiasm for artificial intelligence. Investors now brace for significant macroeconomic challenges ahead, particularly with the release of first-quarter GDP data.