FW: RHB FIC Rates FX Market Update 241117

 

 

24 November 2017

 

 

Rates & FX Market Update

 

 

Strong PMI in Europe Bolstered the Euro

 

Highlights

 

¨   Global Markets: It's Black Friday in the US and various analysis point toward a strong spending spree (November Retail Sales will be released on December 14th). On the markets, the USD remained on a weak footing in muted Thanksgiving holiday trading.  In Europe, strong November Manufacturing and Services PMIs for the Eurozone, Germany and France contributed to the ongoing positive economic story and pushed the EURUSD higher reaching previous November's top at 1.1850. Should the negotiations between the CDU/CSU and the Social Democrats in Germany resume to put an end to the current political gridlock, the common currency would have a clear path to retest this year's highs at 1.20/1.21.

¨   AxJ Markets: In Singapore, following the strong upward revision for 3Q17 GDP growth (see yesterday's publication), inflation prints confirmed the stagnating trend on price pressure as October numbers came in line with September ones (CPI YoY 1.5%; Core CPI YoY 0.4%). Looking forward in the near term horizon , the USDSGD is expected to track global movements and the persisting US Dollar weakness could send the pair to retest its previous lows at 1.3375/1.3400; remain neutral SGD.

¨   In Malaysia, the Ringgit is heading for a fourth straight weekly gain against the backdrop of strong economic developments, higher oil prices, expectations of an OPR hike next year and a weaker USD. The USDMYR pair briefly touched 4.10 yesterday (4.0965 low).However the technical picture advocates for caution in the very short term horizon as a daily doji candlestick was left above the psychological 4.10 support. A short term consolidation/retracement is a possibility at this juncture following the recent rally; 4.1315 would be a first resistance to surpass to confirm a retracement towards maximum 4.20; should the consolidation happen, it does not change our longer term constructive view on the Ringgit with gradual appreciation likely to resume thereafter.

 

 

 

This message is intended only for the use of the person(s) to whom it is addressed and may contain information that is privileged or otherwise protected from disclosure. If you are not the intended recipient you are hereby notified that any use, review, disclosure or copying of this message and the information it contains is prohibited. If you receive the message in error, please notify the sender by reply e-mail and discard all its contents.   Thank You.