Forex news for Asia trading
for Thursday
31
December 2020 

ICYMI

The US dollar once again lost
ground during the session in Asia, currencies generally higher across
the major FX board. Offshore yuan rose also, hitting highs it hasn’t
seen since June of 2018 (circa 6.49 for USD/CNH). As I post the picture is becoming more mixed though with much of the gain

GBP/USD moves back above 1.3600 in thin trading
The dollar is keeping weaker across the board as its struggles going into the year-end continues, with EUR/USD having neared 1.2300 earlier and GBP/USD now climbing back above the 1.3600 handle in European trading.

Latest data released by Credit Suisse and CFA Society Switzerland
Investor sentiment continues to show a marked improvement as vaccine optimism bolsters the economic outlook as we look towards next year. The headline is the highest since June. The reading measures analysts‘ expectations on the Swiss economy and other economic expectations over the next 6 months.

Latest data released by KOF – 30 December 2020
The data measures the future trends of overall economic activity in the Swiss economy.

Comments by UK health secretary, Matt Hancock
We’ll see about that. As the vaccines are being rolled out, it is easy for lawmakers to talk things up right now but delivering on those expectations will be another matter.

Latest data released by UK Nationwide Building Society – 30 December 2020
– +0.9%
– House prices +7.3% vs +6.4% y/y expected
– Prior +6.5%
Annual house price growth continues to accelerate into the year-end, with the UK housing market showing little signs of slowing down. The stamp duty holiday continues to fuel activity in the housing sector

Will Republicans keep hold of the Senate or can Democrats seize control?
The two runoff elections will take place on 5 January next year i.e. next Tuesday, with plenty on the line in determining how US politics will shape up under Biden’s administration over the coming year(s).

European stocks trade higher, US futures also bolstered by stimulus checks
S&P 500 futures are also up by ~0.5% and that is feeding into a more positive risk narrative in the market amid thinner liquidity conditions going into the year-end.

Gold gains remain limited going into the year-end
Amid thinner market conditions, gold doesn’t much to work with as the year winds down as buyers are finding it tough to build further momentum after a solid December.

Dollar keeps weaker across the board today
The key happening in the market is that , with the Senate set to convene later today. That is keeping risk sentiment in a more positive mood as the year winds down, with the dollar slumping amid thinner liquidity conditions.