Credit Agricole

Asia overnight

While a hawkish set of FOMC Minutes threatened to weigh on sentiment in Asia, the session saw relatively solid sentiment. Newswire reports that China’s policymakers were telling local governments to pick up the pace of their investment spending helped bolster sentiment. At the time of writing, most Asian bourses were trading higher as were S&P 500 futures. In G10 FX, the SEK and NOK were modest outperformers, the former heading higher before the Riksbank meeting later today. The NZD continued to trail the rest of the G10 following yesterday’s RBNZ meeting.

Citi

European Open

Thanksgiving Day means that it should be a very quiet session and into the remainder of the week. US cash equity and rates markets will be closed today. BoK hiked its key interest rate by 25bps to 1.00%. The markets perceived the stance of BoK to be less hawkish than market expectations, leading to bull steepening led by the 2-5yr tenors. KRW was little moved. A slightly weaker dollar on the Asian morning meant that most G10 currencies gained against the dollar.

Looking ahead, we look forward to the SEK interest rate decision at 08:30GMT, where Citi Economics do not expect the Riksbank to signal an imminent end to the 0% policy rate. We will see German GDP and consumption data at 07:00 GMT which is unlikely to move markets. GBP will see BOE's Haskel at 14:05 GMT, followed by BOE's Bailey at 17:00 GMT. While we watch these due to the Brexit and Covid backdrop, we do not expect market moving headlines. Over in the EM space, we look forward to HKD trade balance (08:30 GMT) and BRL inflation and current account data (12:00 and 12:30 GMT respectively). MXN will see GDP and current account data (12:00 and 15:00 GMT respectively). We also see the Banxico minutes being published.

GBP will see BOE's Haskel gives introductory remarks at BOE/Niesr workshop at 14:05 GMT, followed by BOE's Bailey speaks with Mohamed El Erian at 17:00 GMT. Similar to Wednesday, speak comes on the back of rising covid concerns and Brexit developments, so we’ll be watching closely, though do not expect it to move markets.

JPY will see Tokyo CPI Ex-Fresh Food, Energy YoY at 23:30 GMT for November. Citi Economics forecast-0.3% vs -0.4% prior. We estimate that the core CPI in Tokyo (the CPI excluding fresh food) is likely to rise 0.3% YoY in November after a 0.1% YoY advance in October, driven by a stronger boost from energy prices.

EUR is holding steady after struggling to hold below 1.1200, after briefly breaching the level late in US hours. Our London trader Angus Yard sees support around 1.1180/1.1200. For those looking for EURUSD weakness over the very short term, we think continue to think it’s hard to chase the move here given positioning and pricing.