South Korea November exports plunge as China-U.S. deal still in dark

By Choonsik Yoo and Joori Roh

SEOUL (Reuters) – South Korean exports in November fell for the 12th month in a row and far more than expected, denting hopes for the global manufacturing sector stabilizing as a much-awaited China-U.S. trade deal is still in darkness.

Exports declined 14.3% in November from a year earlier, trade ministry data showed on Sunday, far below a median 10.2% fall tipped in a Reuters poll and missing even the worst forecast in the survey of an 11.1% loss.

It was also the second-worst drop in overseas sales in nearly four years as global semiconductor prices failed to turn around while China, the country’s biggest export market, continued to cut down purchases from its smaller neighbor.

The surprisingly weak November data from a manufacturing powerhouse, which reports monthly trade data ahead of major exporting nations each month, underscores the global economy still far from a turning point.

“The optimism for the first-phase trade deal between the United States and China will take time before actually boosting exports, and today’s poor data means the turnaround in exports is taking longer than expected,” said Chun Kyu-yeon, economist at Hana Financial Investment.

Shipments to China fell 12.2% in November from a year earlier, while overseas sales of semiconductors, South Korea’s top export item, tumbled by 30.8% in value as prices plunged this year from a super-rally last year.

Imports fell 13.0% on-year in November, also missing an 11.9% contraction tipped in the survey. That brought the November trade balance to a $ 3.37 billion surplus, versus a $ 5.34 billion surplus a month earlier.

Sunday’s data left shipments for the first 11 months of this year 10.7% below a year earlier, putting the country on track for its worst annual exports performance since a 13.9% fall in 2009 during the height of a global financial crisis.

South Korea’s economy, the fourth-largest in Asia and heavily dependent on exports, has been hit especially hard by cooling global trade and a prolonged tariff war between China and the United States.

On Friday, the central bank trimmed its 2019 economic growth forecast for the fourth time this year to the lowest in a decade, and also lowered next year’s forecast.

The downgrades came even after the Bank of Korea cut rates twice this year, the most recent cut coming in October. Many analysts expect the central bank to ease policy further next year to support the stuttering economy.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Major central bank overview for December

The central bank rundown

The weekend is a perfect time for a quick catch up for where the major central banks are at. The central banks are listed below with the most bearish central bank first and the most bullish central bank last.

European Central Bank, 0.00%. Bearish 

The ECB has undergone a change of guard as the former President, Mario Draghi’s, leaves his post. He has been succeeded by Christine Lagarde and her first impact on monetary policy will now be felt on December 12 with the ECB’s latest rate decision. So far, Christine Lagarde has given little away in terms of her approach. However, the outlook for the eurozone remains tilted firmly to the downside with inflation levels in October remaining below the 2% target at 0.7%. The ECB stated that rates will be at present or lower levels until inflation data has picked up closer to the 2.0% target. The ECB should retain a bearish outlook and December 12 is the key date for the market to properly assess what steer Christine Lagarde is going to give. Personally I am expecting some kind of repeat of Draghi’s appeal for fiscal stimulus as central banks around the world accept that monetary policy can only go so far, especially when rates are so low.The risk is that the ECB are more bearish than the 10bps rate cut currently priced in for 2020.

Reserve Bank of Australia, 0.75%. Bearish

The AUD has whipsawed around lately after Governor Lowe’s latest speech on unconventional policy on Tuesday of this week. Although Governor Lowe said that the RBA’s lower rate level was 0.25% and QE would not be even considered before rates hit that level, the market has taken a bearish outlook on his view. The investment banks Westpac and RBC forecast that the RBA will cut the cash rate to 0.25% by June 2020 and follow that up with QE. So, as the market starts to price in additional cuts from the RBA the focus will be on economic data and speeches that confirm or deny this outlook. A rate cut is not expected for next weeks meeting, but the market will be looking for any signals from the RBA about a coming rate cut for 2020. One final aspect to mention is that the Australian economy is closely tied to China’s fortunes with around 30% of its GDP coming from trade with China. Therefore, AUD will be pushed or pulled along with the US-China trade sentiment too.

Federal Reserve, 1.50%-1.75%. Neutral

ECB

The FOMC cut rates by 25bps at their October meeting, but did signal a pause in rate cuts. However, it was also made clear that the Fed was not about to start hiking interest rates either and the Fed was not on a pre-set course. Latest minutes confirmed what Fed speakers had been communicating that the Fed would be on hold for the medium term. The present market pricing is a 94.8% chance of no change for the December meeting. However, the general outlook for US monetary policy is bearish with a 51% chance of a 25bps rate cut by June 2020 and a 72% chance of a 25bps rate cut by December 2020. Latest economic data on Manufacturing and Services PMI have been robust and Durable goods out this week showed a beat at +0.6% vs -0.9% expected with US manufacturing holding up despite the US-China trade concerns. The US Q3 GDP data showed a beat too at 2.1% vs 1.9% expected. However, the main driver of the USD is going to be the US-China trade negotiations.As long as the US domestic economy holds up I sense that President Trump is quite happy with China squirming on the uncertainty of the latest negotiations. Any negative twists will see USD strengthen as its safe haven status comes to the forefront.  

Bank of England, 0.75%. Neutral/dovish

The single cloud which continues to obscure the BoE’s view is Brexit, or more specifically, the chance of a no-deal Brexit. The BoE has slowly shifted to a more dovish stance as the Brexit Withdrawal Agreement has become more and more elusive and investor sentiment has become more reluctant given uncertainties surrounding Brexit. This dovish outlook was recently confirmed when Haskell and Saunders voted for a 25bps rate cut at the last BoE policy meeting.For now the GBP is being moved on election polls. As long as the conservative majority remains heading into the December 12 election, expect GBP buyers. The rationale is that as long as the conservatives have a majority, Boris Johnson’s Withdrawal Agreement bill will pass through UK parliament and in this manner a no-deal Brexit is avoided.

Swiss National Bank, -0.75%. Neutral to bearish

The SNB interest rates are the world’s lowest at-0.75% and haven’t changed at a scheduled meeting since 2009. However, with the strengthening Franc hurting the Swiss export economy a number of large institutions, like UBS Group, Raiffeisen Bank International AG and Bank J. Safra Sarasin, called for a rate cut at the September 19 meeting. This was in response to the Swiss franc increasing more than 4% versus the Euro.These calls were not heeded. As Swiss inflation remains low, in October 2019 it stood at -0.3%, the SNB rate is likely to stay as the world’s lowest interest rate for the foreseeable future.

Bank of Japan, -0.10%. Neutral

Fsderal Reserve

The Bank of Japan is very bearish as a bank. Inflation in Japan continues to miss the 2% target and the BoJ have stated that they will ‘keep very low interest rate levels for an extended period of time’. In October inflation in Japan stood at just 0.2% slowing from its peak in April of 0.9%. The Bank of Japan has been failing to achieve its inflation target for years since it fell from 2.3% to 0.6% in April 2015. The highest reading since then has been 1.5% in February 2018. At their October meeting, in response to low inflation data, the Bank of Japan tweaked their forward guidance to signal a rate cut in the near future by stating that they expect short term and long term rates to stay at current or lower levels for as long as needed. The risks for Japan’s economy are neutral to bearish.

Reserve Bank of New Zealand, 1.00%. Neutral

In early August this year the RBNZ cut interest rates by a surprise 50bps at their rate meeting. Governor Orr was very bearish in his language at the press conference and he didn’t rule out the RBNZ needing to take further action. He saw negative interest rates as an option and even the prospect of QE. So, in November the RBNZ was expected to cut interest rates further from 1.00% to 0.75%.However, the RBNZ surprised markets again, but this time by not cutting interest rates. The RBNZ is now in a wait and see mode. Latest business confidence data out this week showed a decent recovery from recent lows and Goldman Sachs consider the NZD to be one of the biggest potential beneficiaries from Yuan appreciation on a US-China trade deal signing and tariff rollback. Furthermore, GS’s economists are anticipating a moderate recovery in the NZD economy through 2020, so there could be a moderate recovery in NZD and more downside in AUDNZD as the central bank diverge in their outlooks. Certainly AUDNZD is a pair to watch.

Bank of Canada, 1.75%. Neutral/bullish

The Bank of Canada had been the only major central bank to not turn explicitly dovish. However, at their latest rate meeting the BoC highlighted their concern over the US-China trade deal as a potential drag on the Canadian economy and the BoC’s tone was more dovish. However, last week Governor Poioz was more upbeat about the Canadian economy. This week Canada’s September non-farm earnings showed the largest rise in wages since 2014. The Q3 GDP on Friday was as expected at +1.3%, so the BoC should stay on hold at the moment. Adam pointed out that the GDP figure had a chunk taken out by inventory and trade data and if you took those out growth is at +3.4%. So, in short the BoC has enough solid data to maintain rates as they are for the immediate future.

So, ForexLive readers, I hope this is helpful as a quick December rundown on where we are at with the world’s major central banks. Have a great weekend!

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Apple to take ‘deeper look’ at disputed borders

Apple says it is taking “a deeper look” at how it handles disputed borders.

Ukraine criticised the tech giant for showing Crimea as part of Russia’s territory on its Maps and Weather apps.

An Apple spokeswoman says the company follows international and domestic laws and the change, which is only for users in Russia, had been made because of new legislation there.

Russia’s annexation of Crimea from Ukraine in 2014 was condemned by much of the international community.

In a statement, Apple stressed “we have not made any changes to Apple Maps regarding Crimea outside of Russia.

“We review international law as well as relevant US and other domestic laws before making a determination in labelling on our Maps and make changes if required by law.”

Apple added it as a result of its review of how disputed borders are handled, it might make more changes in the future.

“Our intention is to make sure our customers can enjoy using Maps and other Apple services, everywhere in the world.”

Ukrainian condemnation

The changes to Apple’s Crimea map for users in Russia were announced earlier in the week by the State Duma, Russian parliament’s lower house, in a statement, which described the former boundaries as an “inaccuracy”.

“Crimea and Sevastopol now appear on Apple devices as Russian territory,” the statement read.

Russia treats the naval port city of Sevastopol as a separate region.

Apple has been in talks with Russia for several months and had hoped to keep Crimea as an undefined territory, part of neither Russia nor Ukraine.

Google, which produces its own popular map app, also shows Crimea as belonging to Russia when viewed from the country. That change happened in March.

Apple’s move brought sharp condemnation from Ukraine.

Ukrainian foreign minister Vadym Prystaiko tweeted: “Apple, please stick to hi-tech and entertainment. Global politics is not your strong side.”

Ukraine’s US embassy was equally critical on Twitter.

“We guess Ukrainians not giving any thanks to @Apple this #Thanksgiving. So let’s all remind Apple that #CrimeaIsUkraine and it is under Russian occupation – not its sovereignty,” it tweeted.

Russian ex-world chess champion Garry Kasparov added his voice, calling the decision “unacceptable appeasement”.

He added: “Software is soft power. American tech companies should stand up for the values of innovation that made their success possible, not bow down to dictators for a little extra cash they don’t even need.”

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Dollar stands tall as upbeat U.S. data trims Fed cut bets

By Tom Westbrook

SINGAPORE (Reuters) – The dollar headed for its highest weekly finish against the safe-haven yen since May on Friday, as data showing the U.S. economy on a firm footing prompted investors to scale back rate-cut bets.

Nerves persisted though, as other major currencies spent the week rangebound, navigating a blizzard of trade-war headlines that offered few clues as to when or how an overdue truce might be agreed between Washington and Beijing.

“There seems to be pretty good optimism around the trade talks going on between U.S. and China,” said William O’Loughlin, a portfolio manager at Rivkin Securities in Sydney.

“Though as we know that can change on a dime…the rally doesn’t feel like a euphoric, super-bullish rally, it does feel like climbing the wall of worry.”

On Friday, the dollar was steady at 109.51 Japanese yen , and if it holds there will post a 0.7% gain for the week and hit its highest weekly close since May 31. Overnight trade was light with U.S. desks closed for Thanksgiving.

The British pound has been the week’s other main beneficiary, adding half a percentage point as Prime Minister Boris Johnson’s Conservative Party has firmed in opinion polls ahead of the Dec. 12 election.

Sterling was steady on Friday at $ 1.2910, while the euro () held at $ 1.1012.

“The market has come to the view that this is Johnson’s election to lose now,” said Chris Weston, head of research at Melbourne brokerage Pepperstone, with expectations he can win with a large margin.

“That said, should any polls call this margin into question, where invariably there will be one or two, then GBP could see a sharp sell-off, although I would be using that weakness to buy.”

The dollar’s strength this week has drawn on hopes that the United States and China are indeed in the process of negotiating a ceasefire in their damaging tariff war, and strong U.S. economic data.

China has vowed to impose “firm countermeasures” after Trump’s approval of a bill backing Hong Kong’s pro-democracy protesters on Wednesday, but is yet to indicate whether they would have any bearing on trade talks.

U.S. growth picked up slightly in the third quarter, data showed on Wednesday, in contrast to other indicators showing a slowdown in global activity.

The Fed also flagged an upbeat outlook amid signs of labor market strength and a possible turnaround in business investment.

That prompted a pullback on rate cut bets for this year and next, with the market now pricing in a 5% chance the Fed will hike rates next month and mostly expecting it to hold steady.

The strong greenback has Australian dollar slightly weaker for the week, but steady on Friday ahead of a central bank meeting on Tuesday, where the market has priced an 11% chance of a cut in interest rates to a record low 0.5%.

It last traded at $ 0.6767, not far above a six-week low hit on Thursday.

The New Zealand dollar was flat on Friday at $ 0.6418 and held its ground for the week, buoyed by rebounding business sentiment.

China’s yuan was steady at 7.0287 per dollar in offshore trade.

Graphic: World FX rates in 2019 (http://fingfx.thomsonreuters.com/gfx/rngs/GLOBAL-CURRENCIES-PERFORMANCE/0100301V041/index.html)

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NBA roundup: Davis, Lakers crush Wizards for 10th win in row

Anthony Davis had 26 points, 13 rebounds and three blocks in less than three quarters, leading the Los Angeles Lakers to their 10th consecutive win by crushing the visiting Washington Wizards 125-103 on Friday night.

LeBron James, who also rested in the fourth quarter, finished with 23 points and 11 assists for the Lakers, who captured their 17th win in 18 games. Their lone loss during the stretch was at home to the Toronto Raptors on Nov. 10.

Quinn Cook scored 17 points, while JaVale McGee added 15 and Rajon Rondo chipped in with 13. Danny Green added 11 for Los Angeles, which is 9-1 at home.

Wizards guard Bradley Beal, who entered the contest ranked fourth in the league in scoring at 28.9 per game, scored 18 points and recorded nine assists. Rui Hachimura had 16 points and eight rebounds for the Wizards, who have dropped three of four. Ish Smith and Jordan McRae each scored 13 off the bench for Washington.

Bucks 119, Cavaliers 110

Giannis Antetokounmpo capped a 33-point performance with four key hoops down the stretch as visiting Milwaukee held off Cleveland for its 10th straight win.

Antetokounmpo completed a double-double with a team-high 12 rebounds for the Bucks, who beat the Cavaliers for the second time this season. George Hill chipped in with 18 points, while Middleton had 12, DiVincenzo 11, and Eric Bledsoe and Ersan Ilyasova 10 apiece.

Rookie Darius Garland went for 21 points, his second-most of the season, to pace the Cavaliers, who lost their third straight. Fifteen of his points came on 5-for-7 shooting on 3-pointers, helping Cleveland outscore Milwaukee 51-36 from beyond the arc.

Mavericks 120, Suns 113

Seth Curry capped an 11-point Dallas run midway through the fourth quarter as the visiting Mavericks rallied for a victory in Phoenix.

Luka Doncic matched his career-high with 42 points, including four free throws during the late burst that turned a 97-96 deficit with 8:29 remaining into a 107-97 lead with just 5:01 to go. The Suns never seriously threatened after that.

Doncic’s 42 points, which equaled his total against San Antonio Nov. 18, included 15-for-18 shooting at the free-throw line, helped the Mavericks gain a 33-18 advantage over the host Suns. Dallas shot 38 foul shots, Phoenix 25. Doncic also found time for 11 assists and missed his eighth triple-double of the season by one rebound.

Blazers 107, Bulls 103

In a game that saw neither team shoot better than 46 percent, Portland eked out a win over visiting Chicago thanks to a historic effort from Hassan Whiteside.

Portland also had another balanced scoring effort in its third consecutive win, led by 28 points from Damian Lillard, 23 from Carmelo Anthony, 20 from CJ McCollum and 19 from Rodney Hood.

But defense was a key for Portland in the victory, including a franchise-record 10 blocks for Whiteside to go along with eight points and 15 rebounds.

Nets 112, Celtics 107

Spencer Dinwiddie collected 32 points and 11 assists as Brooklyn beat visiting Boston.

The Nets improved to 6-2 without Kyrie Irving, who continued to recover from a right shoulder impingement. Dinwiddie posted his eighth career game with 30 points and third career game with at least 30 points and 10 assists.

Jayson Tatum scored 26 to lead the Celtics, who are 2-4 since their 10-game winning streak.

Jazz 103, Grizzlies 94

Bojan Bogdanovic scored 26 of his season-high-tying 33 points in the second half and finished with eight rebounds to lead Utah past host Memphis.

Donovan Mitchell added 20 points for the Jazz, who improved to 1-2 on a five-game road trip. But Mike Conley struggled for the second time in Memphis this season, hitting 3 of 13 shots for eight points Friday to make him 8-for-32 in the two games in his former home arena.

Jonas Valanciunas had 22 points and 17 rebounds for Memphis, which lost its sixth straight game. Brandon Clarke added 13 points while Dillon Brooks and Ja Morant scored 11 apiece for the Grizzlies, who committed 12 turnovers.

Pacers 105, Hawks 104 (OT)

T.J. Warren’s corner 3-pointer with 1:13 remaining in overtime gave Indiana the lead for good, and the Pacers survived a career-high-tying 49 points from Trae Young to beat Atlanta in Indianapolis.

With 16 points, Warren was one of five Pacers to score in double figures. Jeremy Lamb led the way with 20 points, Myles Turner and Domantas Sabonis each added 17 points, and Malcolm Brogdon scored 16 points.

Young’s season-high scoring performance included a high-arching finger roll with 11.5 seconds remaining in regulation that ultimately forced overtime. Young, who hit 16 of 28 from the floor, 8 of 15 from 3-point range and 9 of 9 at the foul line, has scored at least 29 points in each of his past four games.

Spurs 107, Clippers 97

LaMarcus Aldridge and Derrick White poured in 17 points apiece and six players scored in double figures as San Antonio shocked visiting Los Angeles, who had its seven-game winning streak snapped.

The Spurs, who had lost 10 of their previous 11 games, played some of their best basketball of the season in breaking out from a tie game at halftime to an 87-71 lead a minute and a half into the fourth quarter.

DeMar DeRozan added 15 points and Patty Mills hit for 13, Bryn Forbes scored 12 and Trey Lyles 10 for San Antonio. Former Spurs star Kawhi Leonard, in his second game back in San Antonio after being traded to Toronto prior to last season and signing with the Clippers in the most recent offseason, led all scorers with 19 points.

Raptors 90, Magic 83

Norman Powell scored 19 of his career-best 33 points in the third quarter and Toronto overcame an 11-point deficit in the second quarter to defeat host Orlando.

Fred VanVleet added 22 points for the Raptors, who extended their winning streak to six games. They have won all three games with the Magic this season. Pascal Siakam had 10 points and 13 rebounds for the Raptors, who shot 36.9 percent from the field.

Evan Fournier scored 19 points for the Magic, who shot 34.6 percent from the field and committed 22 turnovers, compared with 13 by Toronto. Markelle Fultz had 15 points and Mo Bamba had 11 points for the Magic. Khem Birch added four points and 12 rebounds and Jonathan Isaac had eight points and 10 rebounds.

Heat 122, Warriors 105

Rookie first-round pick Tyler Herro hit 5-of-6 3-pointers as host Miami defeated Golden State.

Miami improved to 8-0 at home this season, matching the best home start in franchise history, and the Heat is also 7-0 against teams with losing records.

Goran Dragic (team-high 20 points), Herro (19) and Kelly Olynyk (15) combined for 54 points off the Heat bench. The injury-plagued Warriors, who have the worst record in the NBA, were led by Jordan Poole (20 points), Eric Paschall (17 points) and Alec Burks (16 points).

76ers 101, Knicks 95

Joel Embiid totaled 27 points and 17 rebounds as visiting Philadelphia rallied again from a double-digit deficit to beat New York for the 10th straight time on a night in which it was without two starters, Al Horford (rest) and Josh Richardson (hamstring).

Reserve James Ennis III added 18 of his 20 in the second half, when the 76ers shot 52.9 percent. Tobias Harris contributed 19 points while Ben Simmons chipped in 15 points and eight assists. Philadelphia shot 43.1 percent from the floor, hit 32 of 40 free throws and won for the sixth time in seven games overall.

Julius Randle led the Knicks with 22 points, and Marcus Morris added 20, but New York missed 14 of 33 free-throw attempts and lost its fifth straight game. Rookie RJ Barrett contributed 18 points for the Knicks, who held a 16-point lead late in the first half.

Hornets 110, Pistons 107

Rookie P.J. Washington had 26 points and Charlotte defeated host Detroit for the ninth consecutive time.

The Hornets downed the Pistons for the third time this season and the second time in three nights. Charlotte pulled out a 102-101 home win on Wednesday.

This one wasn’t decided until the final buzzer, too. Charlotte’s Terry Rozier scored 23 points, Miles Bridges and Devonte’ Graham contributed 16 points apiece, and Bismack Biyombo tossed in 13 with nine rebounds. Derrick Rose led the Pistons with 23 points off the bench. Luke Kennard scored 21 points, Blake Griffin had 17, and Andre Drummond added 15 points and 19 rebounds.

Thunder 109, Pelicans 104

Dennis Schroder scored 25 points off the bench as host Oklahoma City defeated New Orleans Pelicans in the first of two games between the teams in three days.

Chris Paul sank the go-ahead jumper with 1:24 left in the fourth quarter, and Steven Adams added a tip-in to stake Oklahoma City to a 107-104 lead. Adams capped the scoring by muscling up a left-handed dunk with 15.1 seconds remaining.

Abdel Nader scored 19 points and Danilo Gallinari added 17 for the Thunder, who will vie for a sweep of the home-and-home series when the teams reconvene in New Orleans on Sunday. Brandon Ingram finished with 26 points after shooting 11 of 17 from the floor for the Pelicans.

–Field Level Media

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Forex – U.S. Dollar Stays Little Changed After Strong Data; HK Concerns Weigh

© Reuters.  © Reuters.

Investing.com – The U.S. dollar stayed little changed on Friday in Asia following the release of strong economic data earlier this week.

The last traded at 98.250 by 12:45 AM ET (04:45 GMT), down 0.04%. Data showed this week that the U.S. economy grew at a 2.1% annualized rate, compared to 1.9% in the first reading. The data was in contrast to other indicators showing a slowdown in global activity.

In a separate report, durable goods gained 0.6% after falling 1.4% in the prior month.

Sino-U.S. trade progress remained in focus after U.S. President Donald Trump approved two bills that back Hong Kong’s anti-government protestors. While China has vowed to retaliate, it has not taken any action so far and it is unclear if that will have any bearing on trade talks.

The next batch of American tariffs on Chinese goods are due to begin on Dec. 15.

The U.S. equities and bond markets were closed on Thursday for the Thanksgiving Holiday.

The pair was near flat at 1.2915 as U.K. Prime Minister Boris Johnson’s Conservative Party has firmed in opinion polls ahead of the Dec. 12 election.

The pair inched up 0.1% to 1.1011.

The pair slipped 0.1% at 109.45 as falling Chinese and Hong Kong stocks sent the safe-haven yen slightly higher.

The pair and the pair gained 0.1% and 0.4% respectively.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex- U.S. Dollar Treads Water in Holiday-Thin Trade  

© Reuters.  © Reuters.

Investing.com – The U.S. dollar was flat on Friday in holiday-thinned trade as U.S-China trade progress remained in focus. But Latin American currencies rermained active, with Brazil’s real seeing more sharp moves.

U.S. President Donald Trump signed a law backing Hong Kong protests on Wednesday despite potential backlash from Beijing as the two superpowers try to resolve their trade differences. Chinese officials have threatened to take “firm countermeasures” and Chinese Vice Foreign Minister Le Yucheng demanded that Washington immediately stop interfering in China’s domestic affairs.

The law threatens to derail progress on trade talks, with the next batch of American tariffs on Chinese goods due to begin on Dec. 15.

The , which measures the greenback’s strength against a basket of six major currencies, was steady at 98.36 as of 10:32 AM ET (15:32 GMT). The dollar was flat against the safe-haven Japanese yen, with at 109.50.

Trading was thin due to the U.S. Thanksgiving holiday on Thursday, with most investors off until Monday.

But in Brazil the real saw another slump, with up 1.01% to 4.2324, despite intervention by the country’s central bank. The currency hit an all-time low of 4.277 this week following an essentially failed “mega” oil auction accelerated the real’s decline.

Meanwhile the pound inched up, with rising 0.1% to 1.2917 and unmoved at 1.1010.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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London Bridge stabbing leaves 2 dead, 3 injured

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ForexLive Americas FX news wrap: Canadian GDP matches estimate, oil sinks

Forex news for North American trading on November 29, 2019:

Markets:

  • Gold up $ 8 to $ 1463
  • WTI crude down $ 2.69 to $ 55.42
  • Natural gas down 8.8%
  • US 10-year yields up 1 bps to 1.77%
  • S&P 500 down 13 points to 3141 in shortened session
  • GBP leads on the day, CHF lags
  • NZD leads on the month, AUD lags

US markets were thinned by thinned by the Thanksgiving holiday but it wasn’t necessarily quiet. What made it a particularly intriguing session was that it was holiday-thinned by also the final trading day of the month. That set up a an opportunity for fixing flows to take over and that’s exactly what happened.

Models anticipated USD softness into the fix but in the hours beforehand the dollar was strong enough to send the euro below the November low. However the fixing flows started about 30 minutes before 11 am ET and helped to spark a rally to 1.1020 from a low of 1.0981.

It was a similar story elsewhere as USD weakness boosted cable to 1.2933 from 1.2890. The attack in London had no effect on the currency but an earlier poll showing Labour momentum had hurt it.

The big market mover was a report saying that Russia may not be inclined to pre-announce an OPEC+ production cut and may instead want to wait until April to decide. Going into next week’s meeting an extension of 3-6 months was the bare minimum the market was expecting. Add in thin liquidity and WTI crude fell a whopping 4.6% to a low of $ 55.02 before bouncing to $ 55.42 late.

Despite the fall in oil, CAD finished flat on the day as the oil weakness was ignored, or at least balanced by USD-negative flows. Another factor was the GDP report. While the headlines matched estimates, the details of the report were strong (at least according to this guy).

Have a great weekend, the next two weeks are jam-packed so we’ll see you Monday.

Forex news for North American trading on November 29, 2019:

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A $3 Trillion BOJ Quantitative Tightening Scheme? Kuroda Says No

(Bloomberg) — Bank of Japan Governor Haruhiko Kuroda had a little blast from the past in question time at the nation’s parliament on Friday, with a query about an old rule for monetary policy that fell by the wayside years ago.

It was called the banknote rule, and it said BOJ holdings of Japanese government bonds shouldn’t exceed the value of banknotes outstanding. The idea was it would help to avoid any impression the central bank was directly financing the government. When Kuroda unleashed his first stimulus program in April 2013, he and the board decided to “temporarily suspend” the principle.

Fast forward six and a half years, and “temporary” is looking much like permanent. For the record, Kuroda, responding to a lawmaker at the Diet Friday, said there was no need to reinstate the rule now.

Any immediate reinstatement would be practically impossible. That’s because the BOJ would need to shrink its bond portfolio by some $ 3.4 trillion to meet it. Its bond holdings total 475 trillion yen ($ 4.3 trillion) at latest count, versus only 108 trillion of banknotes outstanding.

It speaks to the massive expansion of the BOJ’s balance sheet under Kuroda. The governor said back in 2015 that the banknote rule would need to be considered once 2% inflation was reached, but hasn’t much discussed it recently. (Most private economists in Japan don’t ever see the country reaching the BOJ’s 2% inflation target.)

Theoretically, the bank could work off its holdings over time by letting the securities mature, though given the size of the portfolio that would take many years. Another option floated by BOJ watchers is to move a large portion of the assets off the central bank’s balance sheet. The Hong Kong Monetary Authority effectively did that after buying equities during the Asian financial crisis. The HKMA then floated its holdings as a tracker fund.

The BOJ could then look at returning to the old banknote rule. But there’s little likelihood of the debate becoming pressing: Japan’s inflation rate was 0.4% in October, less than a quarter the way to the target.

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