Jan 14th, 2016: MPC Unlikely to Follow the Fed’s Lead

• This morning, Asian markets have been struggling after a volatile session in the US which saw the main stock markets close by over 2.00%. This comes as oil prices continue to plunge, with terrorist attacks in Istanbul and Jakarta. The dollar index continues to act as the global reserve currency with demand only increasing in 2016 to date.

• The yen has lost some of its shine, with the yen pairs rising this morning.

• The Australasian pairs have been buoyed by strong Aussie employment data.

• Meanwhile, the UK’s MPC meet today to set benchmark interest rates. It is expected that the MPC will keep things unchanged on concerns for the UK recovery. The pound has continued to underperform the euro in 2016.

Coming up today: 

• Coming up today, we have the latest statement from the MPC, with no change expected on rates or the asset purchase facility. This comes at 12.00.
• Following this we have US unemployment claims at 13.30, released alongside Canadian NHPI, US Import Prices and Fed member Bullard speaking.

Trade Idea: 

• The USD/CAD has been steadily ticking higher as oil prices steadily drip lower. With no end in sight to this trend, it still make sense to ride the USD/CAD train higher.

• A good way to play this is a HIGHER trade predicting that the USD/CAD will close higher than 1.4400 in 42 days time for a potential return of 123%.

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