FOREX: Light Dollar Outperformance Noted, Kiwi Lagging
The Bloomberg dollar index is re-testing earlier session highs of 1204.3, currently +0.1% today. A pullback in US yields after China announced additional tariffs on beef imports has had a limited impact on FX markets, with aggregate activity contained given the NYE holiday in several countries. A higher close for the BBDXY today would mark a fourth consecutive positive session, although resistance levels at 1205.4 (Dex 23 high) and 1207.5 (20-day EMA) remain intact.
- The Kiwi underperforms the G10 basket, with NZDUSD down 0.4% at typing. The pair is testing support at the 50-day EMA of 0.5766, clearance of which would expose the December 19 low of 0.5736.
- Meanwhile is AUDUSD, focus remains on the psychological 1.16 figure (currently +0.2% at 1.1585).
- Both USDCNH and USDCNY are hovering just below the 7.0000 figure. Overnight, the official Chinese manufacturing and non-manufacturing PMIs for December were stronger-than-expected, inching into expansionary territory.
- The USD/CNY fix printed at 7.0288, while the BBG market consensus was below the 7.00 level at 6.9966. The USD/CNY fixing was below yesterday’s and last week’s levels resuming the downtrend. We wrote yesterday that Authorities may act to slow any acceleration in the downtrend, but the outlook for CNY remains positive, with markets almost uniformly looking for USDCNY further below 7.00 in 2026. See here: https://www.mnimarkets.com/articles/higher-usdcny-fix-only-provides-temporary-support-before-new-lows-1767082916217
- Today’s European session is very quiet, with only UK markets open for a half day. Focus this afternoon is on the US weekly jobless claims release.
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SPAIN DATA: Nov Manuf PMI: Still Expansionary But Some Signs Of Waning Momentum
The Spanish manufacturing PMI has now been in expansionary territory since April. However, alongside the lower-than-expected reading, details of the November report were soft in places, with higher demand in part driven by discounting.
- MNI: SPAIN NOV MANUF PMI 51.5 (52.3 FCAST, 52.1 OCT)
Key notes from the release:
- “Panellists reported that demand was generally higher, but in part driven by discounting. This was highlighted by a drop in output charges for a third successive month and to the greatest degree since June”
- “Competitive pressures were noted, and firms typically cut their selling prices despite a marginal rise in input costs (which were underpinned by increased food, metals and energy prices).”
- “Demand growth in November was also primarily driven by the domestic market as new export orders declined for a third month in a row (albeit marginally)”
- “Firms were generally reluctant to replace leavers or renew expiring temporary contracts in November. Workforce numbers were little changed as a result overall”
- “Business confidence remained positive in November, with expected growth in the year ahead noted by most panellists.”
SILVER TECHS: Northbound
- RES 4: $60.852 - 1.382 proj of the Oct 28 - Nov 13 - 21 price swing
- RES 3: $60.000 - Psychological round number
- RES 2: $59.563 - 1.236 proj of the Oct 28 - Nov 13 - 21 price swing
- RES 1: $57.864 - Intraday high
- PRICE: $57.201 @ 08:18 GMT Dec 1
- SUP 1: $51.358 - 20-day EMA
- SUP 2: $48.863/45.557 - 50-day EMA / Low Oct 28
- SUP 3: $41.135 - Low Sep 17
- SUP 4: $38.087 - Low Aug 27
Trend signals in Silver remain bullish - price has traded to a fresh all-time high today as it begins the week on a firm bullish note. This confirms a resumption of the uptrend and maintains the bullish price sequence of higher highs and higher lows. The move above $55.00 signals scope for a climb towards $59.563, a Fibonacci projection. On the downside, initial support lies at $51.358, the 20-day EMA. Support at the 50-day EMA lies at $48.863.
MNI: SPAIN NOV MANUF PMI 51.5 (52.3 FCAST, 52.1 OCT)
- MNI: SPAIN NOV MANUF PMI 51.5 (52.3 FCAST, 52.1 OCT)
