We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
Gold
Bullish
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Mixed
More View more
Real Time News
  • #GBP, #SEK and the #NOK are expected to be the most active G10 currencies vs USD with 1-week implied volatility at 9.35, 9.13 and 8.90, respectively
  • *Reminder: Weekly Strategy Webinar tomorrow morning at 8:30am ET on DailyFX! https://t.co/RgnsklZ2Gl
  • The Australian and New Zealand Dollars trimmed their gains as optimism on the US-China “phase one” trade deal faded. NZD/USD is at risk to turning lower on signs of technical indecision $AUDUSD $NZDUSD #tradewars - https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2019/12/16/Australian-Dollar-and-New-Zealand-Dollar-Outlook-as-Week-Begins.html?CHID=9&QPID=917702 https://t.co/SmVBWwojc3
  • - The Singapore Dollar (SGD) presents a unique undertaking for traders - It is guided by the MAS, which manages the exchange rate instead of short-term rates - Learn the principals of developing an SGD fundamental forecast to trade USD/SGD https://www.dailyfx.com/forex/fundamental/article/special_report/2019/09/03/The-Singapore-Dollar-and-MAS-What-is-SGD-and-How-to-Trade-it.html
  • #DidYouKnow a #Doji candlestick signals market indecision and the potential for a change in direction. What are the top five types of Doji candlesticks? Find out: https://t.co/c51s3IBcEu https://t.co/eWM70sTfq3
  • Natural Gas trading is popular among traders due to its volatility. How can you trade this? Find out here: https://t.co/GSzSS9fn7Z https://t.co/bl0lp9NtkQ
  • #EURUSD pivot points (daily) – S3: 1.0991, S2: 1.1065, S1: 1.1093, R1: 1.1167, R2: 1.1214, R3: 1.1288- https://www.dailyfx.com/pivot-points?ref=SubNav?utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • Hello there, traders! Themes for this week's webinar: - US-China #tradewar - #HongKongProstests: Carrie Lam's visit to Beijing - #UKElections2019 recap + outlook - Government shutdown in 2020? - Update on #RCEP - CRUCIAL rate decision this week⬇️ https://www.dailyfx.com/webinars/146770987
  • With increasing volatility in weather patterns, how might storms, hurricanes, and floods rattle the supply chain for petroleum-based products and impact crude oil prices? Get your market update from @ZabelinDimitri here:https://t.co/O4dgBl47fq https://t.co/eMb7iCfdqS
  • Join analyst @DavidJSong at 5:30 PM ET/10:30 PM GMT for your weekly update on key news trading events. Register here: https://t.co/gBlrRpCc55 https://t.co/1rVzPr6gx4
US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

2019-10-30 13:30:00
Justin McQueen, Analyst
Share:

MARKET DEVELOPMENT – US Dollar Rises on GDP, South African Rand Crashes, CAD Eyes BoC

DailyFX 2019 FX Trading Forecasts

USD: The US Dollar is on the front foot following the better than expected Q3 growth figures of 1.9%, which highlighted that consumer spending had yet gain kept US growth relatively robust. Elsewhere, the ADP employment report was mixed with the headline beat offset by the weak revision, however, while the ADP report does continue to highlight that jobs growth is slowing.

US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

Looking ahead, the key focus is the FOMC rate decision, although given that a rate cut is a foregone conclusion (95% priced in), much of the attention will be placed towards the statement alongside the press conference. Signals from Chair Powell that the Fed may look towards providing an interim break to further rate cuts could see the US Dollar higher with equity markets on the backfoot.

Fed Commentary Highlight Divide on Monetary Policy Path

US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

ZAR: The South African Rand is on course for its largest drop this year after the Treasury projected that the budget deficit will rise to a two-decade high of 5.9% of GDP, notably higher than the prior projection in February of a 4.2% deficit. Consequently, the Finance Minster stated that the risk of a sovereign credit rating downgrade had increased since February’s budget. As a reminder, Moody’s are due to announce their latest update on South Africa’s sovereign debt on Friday. They are the last rating agency to have SA sovereign credit in investment, thus a decision to downgrade would see SA fall into junk status, to which the IMF have estimated that could lead to ZAR 20bln worth of outflows.

That said, instead of downgrading the debt, Moody’s could potentially opt for lowering their outlook from stable to negative (current status is Baa3, outlook stable).

CAD: Expectations are for the BoC to stick with its neutral bias and signal that current degree of monetary policy stimulus remains appropriate, given that Canadian data has held up as of late. Consequently, while option pricing shows that overnight implied volatility has more than doubled to account for BoC and Fed risk, the implied move a relatively tame 60pips, in which we see the latter risk as the more important in providing volatility.

US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market OpenUS Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

Source: DailyFX, Refinitiv

Economic Calendar (30/10/19)

US Dollar Rises Ahead of Fed, South African Rand Crashes, CAD Eyes BoC - US Market Open

Source: DailyFX,

WHAT’S DRIVING MARKETS TODAY

  1. Canadian Dollar Price Outlook: USD/CAD Volatility Soars on BoC and Fed Risk” by Justin McQueen, Market Analyst
  2. EUR/USD Price Eyes 1.1200 as US Dollar Braces for FED Rate Decision” by Paul Robinson, Currency Strategist
  3. Brexit Latest: Sterling (GBP) Untroubled by General Election Fears, FOMC Ahead” by Nick Cawley, Market Analyst

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.