ForexLive European FX news wrap: Dollar mixed ahead of more US data to come

Headlines:

• Dollar keeps more mixed on the session thus far
• AUD/USD erases post-CPI advance as sellers wrestle back some near-term control
• What are the main events for today?
• Germany December final CPI +2.6% vs +2.6% y/ prelim
• Italy December final CPI +1.3% vs +1.4% y/y prelim
• UK November monthly GDP +0.1% vs +0.2% m/m expected
• China reportedly eyes unwanted Volkswagen factories to gain foothold in German market
• China to initiate anti-dumping probe into US subsidies in its chip industry

Markets:

• JPY leads, AUD lags on the day
• European equities higher; S&P 500 futures up 0.1%
• US 10-year yields up 2.7 bps to 4.679%
• Gold up 0.3% to $2,702.83
• WTI crude down 0.5% to $80.04
• Bitcoin down 0.5% to $99,212

It was a quieter session with just some light market moves overall. All eyes remain fixated on more US data to come, with retail sales and weekly jobless claims still on the agenda this week.

The dollar is keeping more mixed as it is trading higher against the rest of the major currencies bloc but lower only against the yen.

USD/JPY is down 0.2% to 156.10 but fell as low as 155.20 earlier in Asia trading. That comes as traders are also growing more wary about a potential BOJ rate hike next week. The drop in bond yields after the US CPI report yesterday was also another reason but yields are bouncing back a little today.

The greenback in general is not too much hurt outside of the yen on the inflation numbers. EUR/USD continues to keep under 1.0300 with GBP/USD down again to test waters below 1.2200. Meanwhile, USD/CAD is up 0.3% to 1.4385 and AUD/USD down 0.5% to just under the 0.6200 level on the day.

In other markets, equities remain buoyed after the gains yesterday with European indices higher alongside US futures. The latter is seeing gains trimmed ahead of the open but for now, the market mood is still in a slightly more optimistic spot at the balance on the week.

As for commodities, gold continues to stay underpinned this month as it now runs up to a test of the $2,700 mark. The precious metal continues to stay hot to start the new year and is already nearly up 3% in January so far.

This article was written by Justin Low at www.forexlive.com.