FX Ending Week with a Whimper

Market Drivers November 15, 2019
S&P 500 hits all time highs in overnight trade
FX pairs quiet – US Retail Sales main event
Nikkei 0.70% Dax 0.40%
UST 10Y 1.84%
Oil $56/bbl
Gold $1464/oz
BTCUSD $8649

Europe and Asia:
No Data

North America 
USD Retail Sales 8:30

FX markets were very quiet on the final session of the week as traders were content to tread water amidst very little fresh newsflow and no major economic releases.

Both kiwi and Aussie firmed in Asia after a big selloff the day before, but both pairs remained under key levels as news from the region suggests that slowdown shows no signs of abating and interest rate policy may need to be cut further.

In Europe, the EURUSD has bounced off the 1.1000 figure and remains steady for now. This week Germany has been able to narrowly avoid a recession and that has been a double-edged sword for the currency. On the one hand, it shows that organic demand is stronger in the region than originally thought, but on the other, it allows for further complacency on the part of German politicians who continue to refuse the idea of additional fiscal stimulus. For now, the 1.1000 level appears to be the equilibrium level for the pair as markets await news.

In North America today the focus will be on US Retail Sales which are expected to rebound to 0.3% from -0.1% the month prior. With employment steady, the assumption is that the consumer will continue to spend setting for a healthy Christmas season. A beat on the data could spur a rally in USDJPY back to 109.00 and could lift the S&P further into record territory, but a miss could jar the markets which have clearly grown complacent over the past few days as volatility has compressed. With business capex spending in contraction, the consumer remains the only final hope of bulls to keep the growth growing.