FX Overnight Markets

Respective monetary policy decisions from the Fed & BoC kept USD & CAD on the backfoot, as Asian markets picked up on yesterday's reaction moves. USD/CNH dropped despite a slew of worse than exp. off'l PMI readings out of China.

The Antipodeans were bought. NZD was on the lead after improvements were seen in local building permits & biz. confidence, while Westpac dropped their expectation of a 25bps OCR reduction in Nov, calling for a Feb cut instead.

The BoJ stood pat on policy, but tweaked language around its forward guidance (as anticipated in an earlier Nikkei report) & now promises to keep rates low"as long as it is necessary." JPY showed very muted reaction.

In South Korea, a beat in industrial output, the largest fall in chip inventories in two years, and a strong Samsung earnings report put a bid into KRW, rendering it the best performer in Asian FX space. Augmented by USD weakness, these factors dragged USD/KRW to fresh multi-month lows.

A busy day ahead, data docket includes German retail sales, EZ & Canadian GDPs, EZ& French CPIs, as well as U.S. personal income/spending & MNI Chicago PMI. BoJ Gov Kuroda will hold a presser, ECB's de Guindos also set to speak.

FX Related Economic News:

Thursday's data calendar remains busy, with the highlights being the publication of preliminary GDP figures and flash inflation for the Eurozone at 1000GMT. In the US the release of the Chicago Business Barometer at 1345GMT will be closely watched.

FX Relative Performance:

Today's Interesting Articles:

Stocks Trade Mixed; Treasuries Rally Stalls: Markets Wrap (Bloomberg)

Stocks in Asia were mixed after the Federal Reserve indicated that it’s unlikely to move in either direction on policy any time soon following its latest interest-rate cut, while corporate results continued to roll in. Gains in Treasuries petered out.

BOJ Deploys Words Instead of New Policy Action to Fight Slowdown (Bloomberg)

The Bank of Japan resorted to words rather than fresh policy action in dealing with the effects of a global slowdown and limp inflation, in contrast to the interest rate-cutting response of the Federal Reserve and other central banks across the world.

Euro-Area Industry Managers Expects Exports to Get Worse (Bloomberg)‍

Confidence among euro-area industry executives is at the lowest since 2009 when it comes to exports in the months ahead, according to the European Commission. It’s the latest sign that the regions’s already-battered industrial sector has taken an additional hit from the looming threat of new U.S. tariffs and the lingering uncertainty over U.S.-China trade tensions.

Pound Investors' Biggest Fear on Snap U.K. Election Isn't Corbyn (Bloomberg)

Pound traders eyeing a snap U.K. election in December are more worried about Brexit champion Nigel Farage than the socialist agenda of Labour leader Jeremy Corbyn.

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