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Forexlive Americas FX news wrap: US CPI remains steady and below 2% – ForexLive


Forex news for North American trading on November 12, 2020

In other markets:

  • Spot gold is up $10.60 or 0.57% at $1876.35.
  • Spot silver is down $0.01 or -0.05% at $24.26
  • WTI crude oil futures are down $0.43 or -1.04% at $41.02

The US CPI for the month was unchanged while the year on year level came in lower 1.2% vs. 1.3% estimate and 1.4% last month. Taking out food and energy, the consumer inflation fell to 1.6% from 1.7%. The Federal Reserve would like to see inflation increase above 2% and stay above 2%. The numbers today support the Fed’s assertion that inflation will keep the Fed policy unchanged for an extended period of time (perhaps years).

That reminder did not help equity’s today as they fell across the board. Both the S&P and the Dow industrial average fell around 1% on the day. The NASDAQ index declined by -0.67%. European shares also broke their 3 day win streak with declines across the board today.  France’s CAC was the worst performer with a decline of -1.52% Fears of Covid pandemic accelerating out of control, can raise its ugly head at the time, and can we can stocks on fears of slower growth. 

Below is the ranges and closes for the major indices in North America and Europe. 

Fed’s Powell, Bank of England’s Bailey, and ECB’s Lagarde all participated in a ECB forum.  Each tried to be a little bit upbeat (Powell: vaccine good news for medium-term. Bailey: vaccine might start to reduce uncertainty. Lagarde: clearly seeing a little less uncertainty), but reserved some judgment for the economic risks from Covid.  

In the forex, the GBP is ending the day as the weakest of the majors for the 2nd consecutive day.  Yesterday, the GBPUSD fell to the 100 hour MA and stalled. Today the pair fell below the 100 hour MA at 1.3197, stayed below and moved to the 200 hour MA at 1.31104 and stalled. The pair is trading just above that level into the new trading day (and it will be the barometer for the buyers and sellers in the new day). 

The JPY was the strongest with most of its gains vs the GBP, CAD, AUD and NZD.  All the commodity currencies were lower led by the AUD.  

The USD is ending the session with gains vs the GBP, CAD, AUD and NZD. It fell vs the EUR, JPY.  

The GBP is the weakest for the 2nd consecutive day

Some technical levels to watch as we head into the last day of the week:

  • NZDUSD. The NZDUSD is dipping below its 100 hour moving average at the 0.6842 level into the Thursday close. That is the 1st dip below the moving average level since breaking above back on November 4 near 0.6636.  Stay below, would keep the sellers more control. Close risk comes in at the high from Monday’s trade and an earlier intraday low from today at the 0.68543 level.

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