The Aussie AUD=D4, often considered a gauge of global risk appetite as well as a liquid proxy of Chinese growth because of Australia’s export-reliant economy, was up 0.3 percent at 71.62 cents.
The Canadian dollar CAD=D4 and the Norwegian crown NOK=D4 were also up more than a quarter of a percent each, while the New Zealand dollar gained nearly half a percent.
“Markets are finding comfort in the fact that the trading level of WTI futures has shifted above $50 a barrel,” said Yukio Ishizuki, senior currency strategist at Daiwa Securities.
“Commodity-linked currencies are performing strongly as a result,” he said, noting that the WTI futures had tried, but were not able to cross the psychologically-important level during the previous trading session.
“The market became too pessimistic about the global economy up to the beginning of the year, but it seems this kind of pessimism is fading,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
The dollar index .DXY, which measures the greenback against a basket of six peers, edged 0.1 percent lower to 95.803. It hovered not far off an 11-week low of 95.638 touched early this week.
Against the yen JPY=, the dollar gained
Elsewhere, the euro EUR= edged up 0.2 percent to $1.1459, but its rebound was not big enough to recover a slightly steeper loss in the previous session on concerns about a slowdown in the euro zone economy.
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· The Euro holds the key for the DXY and as it flirts with a breakout we may have a resolution soon. Pent up pressure since late October and all last year, really, with diminishing price swings, has the Euro set up for a big move soon. One-month implied volatility shows a clean one-year pattern suggesting we could be in for a round of much larger price swings in the months ahead. Clearance into the mid-11500s will have the ground above 11800 first in focus, if not higher. A failure to overtake resistance and drop lower out of congestion is seen as potentially leading to strong move lower.
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Key Headlines:
Americans are hurt by uncontrolled, illegal migration.
Barrier `absolutely critical' to border security.
Border wall would `very quickly pay for itself'.
Democrats in
Shutdown fix is for Democrats to fund border security.
Wants USD 5.7b for a border wall.
Agrees to steel rather than concrete.
· Trade negotiators from China and the U.S. have narrowed some of their differences, The Wall Street Journal reported Tuesday.
The report, which cited sources, said the negotiators made progress on issues such as the purchase of U.S. goods and services. It also said that a follow-up conversation between Cabinet-level officials is expected later this month. However, the two sides are still not ready to reach a deal just yet.
· The U.S. trade delegation in Beijing is wrapping up meetings with Chinese officials and will return to the United States later on Wednesday, a U.S. official said.
· China’s finance ministry will propose an annual fiscal deficit target of 2.8 percent of gross domestic product (GDP) for 2019, up slightly from the 2.6 percent target set for 2018, Bloomberg reported citing two unidentified sources.
China’s annual economic targets, usually announced in March, are closely watched by financial markets for hints of any changes in its fiscal and monetary policies, which shifted into growth-boosting mode last year as the economy started to slow.
· As a partial U.S. government shutdown neared the three-week mark, Democrats on Wednesday were set to test Republicans’ resolve in backing President Donald Trump’s drive to build a wall on the border with Mexico, which has sparked an impasse over agency funding.
House of Representatives Speaker Nancy Pelosi and her fellow Democrats who took control of the chamber last week plan to advance a bill to immediately reopen the Treasury Department, the Securities and Exchange Commission and several other agencies that have been in partial shutdown mode since Dec. 22.
· Pro-European Union campaigners in Britain have set out for the first time their preferred path for how parliament could force the government to call a fresh vote on Brexit, arguing that there is still time for another referendum.
The future of Brexit remains deeply uncertain - with options ranging from a disorderly exit to another referendum - because British lawmakers are expected on Jan. 15 to vote down the deal that Prime Minister Theresa May struck with the EU in November.
If May’s deal is voted down next week, ministers have to say in a parliamentary motion how they plan to proceed within 21 days.
· The World Bank is downgrading its outlook for the global economy this year, citing rising trade tension, weakening manufacturing activity and growing financial stress in emerging-market countries.
In a report titled “Darkening Skies,'' the anti-poverty agency said Tuesday that it expects the world economy to grow 2.9 percent in 2019, down from the 3percent it forecast back in June. It would be the second straight year of slowing growth: The global economy expanded 3 percent last year and 3.1 percent in 2017.
· President Donald Trump is increasingly eager to strike a deal with China soon in an effort to perk up financial markets that have slumped on concerns over the trade war, according to people familiar with internal White House deliberations.
Talks between
· “We could get some more stabilization and a floor in the market if we make strides towards an agreement” on trade, Kate Moore, chief equity strategist at BlackRock Inc (NYSE
· Oil prices rose by around 1 percent on Wednesday, extending gains from the previous session on hopes that Washington and Beijing may soon resolve trade disputes that have cast a dark shadow over the global economy.
U.S. West Texas Intermediate (WTI) crude oil futures CLc1 were at $50.42 per barrel at 0752 GMT, up 64 cents, or 1.3 percent, from their last settlement. That marked the first time this year that WTI has topped $50 a barrel.
International Brent crude futures LCOc1 were up 69 cents, or 1.2 percent, at $59.41 per barrel.
Reference: Reuters, CNBC,Bloomberg,FXStreet,DailyF
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