Generally FX market moves were muted as the Health Care vote put traders on hold. The Aussie was the worst performing G10 currency overnight, falling 0.7% to a low of 0.7622 during the session. The Yen consolidated recent down moves, currently trading around the 111 level, it’s direction not helped by a choppy range bound Dollar Index which saw prices fluctuate between 9965-9942.
The ObamaCare repeal vote has been delayed for scheduling reasons. To avoid the vote being held in the middle of the night, Washington has indicated the debate will start from 10AM Sydney time today, however a vote (time unknown) will potentially occur Friday night/Saturday morning Sydney time. Trump stated the vote is going to be “very close” and that “we have a chance”.
The Feds Yellen made no remarks regarding the economy or monetary policy overnight. Her pre-prepared speech for a childhood education conference in Washington had no effect on markets.
US Indices recovered more of Tuesdays sell off midway through the session, this saw Positive closes across European Indices (DAX +1.14%, CAC +0.76%, FTSE +0.22%), however US indices were sharply sold late in the US session as the expected Washington vote created concern.
European markets will have to play catch up on their reopens later this evening. The Euro has paused just under the 1.08 level. A break of this level is expected should the US dollar come under pressure.
As recent Canadian economic data has fallen out of sync with the BOC’s dovish tone, the outperformance of the AUD/CAD is presenting a tactical short opportunity for traders. CPI m/m tonight out of Canada at 11:30PM will be interesting to watch for any outperformance.
