Themes

• General mood is “risk off”
• U.S. yields come back slightly, removing impetus from currency markets
• Canadian CPI hits a four year high

What’s Moving

U.S. yields paused and consolidated overnight, which saw currency markets, devoid of other fresh incentives consolidate. Equities were also slightly weaker on profit taking after the recent run up.

U.S. Building Permits and Housing Starts were largely as expected, while a four year high in Canadian CPI saw the CAD bid up, then slide back down.

Commodities were a little more interesting, with gold slightly weaker and oil again nudging a new fresh recent high.

Thoughts

If we come into Asia quiet, Asia is likely to remain quiet, with continued consolidation expected to keep currencies within tight ranges.

The asterix to this comment is the Australian Unemployment data which is set for release today and may well have an impact on the AUD if its much away from expectations. Market is talking:

• Australian Employment Change (E: 60k)
• Australian Unemployment Rate (E: 4.5%)

Pivot Points