(pare/closed(GMT +2)/change, %)

EUR/USD $1,0582 +0,27%

GBP/USD $1,2209 +0,29%

USD/CHF Chf1,0138 -0,29%

USD/JPY Y115,41 -0,29%

EUR/JPY Y122,12 -0,04%

GBP/JPY Y140,89 -0,02%

AUD/USD $0,7439 +0,97%

NZD/USD $0,7052 +0,91%

USD/CAD C$1,3177 -0,40%

05:00 Japan Eco Watchers Survey: Current December 52.5 50.0

05:00 Japan Eco Watchers Survey: Outlook December 53

06:00 Japan Prelim Machine Tool Orders, y/y December -5.6%

10:00 Eurozone Industrial production, (MoM) November -0.1% 0.5%

10:00 Eurozone Industrial Production (YoY) November 0.6% 1.6%

12:30 Eurozone ECB Monetary Policy Meeting Accounts

13:30 Canada New Housing Price Index, MoM November 0.4% 0.3%

13:30 U.S. Continuing Jobless Claims 2112 2118

13:30 U.S. Import Price Index December -0.3% 0.7%

13:30 U.S. Initial Jobless Claims 235 255

13:30 U.S. FOMC Member Charles Evans Speaks

19:00 U.S. Federal budget December -137 -25

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 4.1 million barrels from the previous week. At 483.1 million barrels, U.S. crude oil inventories are at the upper limit of the average range for this time of year.

Total motor gasoline inventories increased by 5.0 million barrels last week, and are at the upper limit of the average range. Both finished gasoline inventories and blending components inventories increased last week.

Distillate fuel inventories increased by 8.4 million barrels last week and are above the upper limit of the average range for this time of year. Propane/propylene inventories fell 4.5 million barrels last week but are in the upper half of the average range. Total commercial petroleum inventories increased by 13.4 million barrels last week.

Monthly estimates of GDP suggest that output grew by 0.5 per cent in the three months ending in December 2016 after growth of 0.5 per cent in the three months ending in November 2016. Our estimates suggest that the economy grew by 2 per cent in 2016, compared with 2.2 per cent in 2015. These figures are close to the UK's long run potential growth rate.

NIESR's latest quarterly forecast (published 2 nd November 2016) projects GDP growth of 2 per cent per annum in 2016 and 1.4 per cent in 2017. CPI inflation is expected to reach 3.8 per cent at the end of 2017.

"The UK's High Court decision on November 3 took some pressure off the British Pound. But Prime Minister May's speech on Sunday (8 Jan), which simply restated her plan to trigger Article 50 by March and leave the EU within two years, has been sufficient to pull the currency down to the October lows.

Cable moved from 1.229 on Friday's close to 1.216 today. This is a testament to how vulnerable the Pound is to the repricing of a 'hard Brexit' scenario, as well as, in our view, the extent to which periods of Sterling strength are the result of markets not discounting the new reality appropriately, a reality that we have fully incorporated into our outlook for the currency since the referendum in June and that we have reiterated several times since.

The FX market has not yet re-engaged with selling Sterling. Net shorts have been reduced (Exhibit 2) and GBP has been one of the few G10 currencies not to depreciate substantially against the Dollar since the US elections.

But, in our view, Sterling is 'actionable' and soon set to become even more 'unfashionable', despite the recent move lower, as coming political events will only increase uncertainty on the future relationship between the UK and the EU. The Supreme Court is due to rule in favour of the High Court Decision on the need for a Parliamentary vote to trigger Article 50 by the end of the month. In response, the government will need to prepare a bill for the vote to take place before the end of March. This preparatory work, together with a subsequent parliamentary vote in favour of triggering Article 50, is likely to increase uncertainty even further. The kind of deal the EU and the UK will agree on will remain unclear for some time, with the UK government sticking to PM May's 'red lines' (immigration control and backing away from the European Court of Justice's jurisdiction) and the EU refusing to grant the UK participation in the Single Market under these demands. We expect the main economic consequences to be twofold: (i) an economic slowdown owing to elevated political uncertainty that reduces investment, employment and consumption as a result of higher prices, and (ii) an adjustment to the UK's external balance requiring a substantial decline in the current account deficit".

Copyright © 2017 Goldman Sachs, eFXnews™

EUR/USD 1.0400 (EUR 1,104 M) 1.0465-1.0480 (EUR 981 M) 1.0500 (EUR 685 M) 1.0550 (EUR 1,600 M) 1.0600 (EUR 796 M) 1.0625 (EUR 260 M)

GBP/USD 1.2120-1.2125 (GBP 209 M)

EUR/GBP 0.8650 (EUR 248 M)

USD/JPY 114.15-114.20 (USD 410 M) 114.75-114.90 (USD 775 M) 115.20-115.35 (USD 485 M) 115.50 (USD 180 M) 115.70-115.75 (USD 244 M) 116.00 (USD 615 M) 116.50 (USD 360 M) 117.00 (USD 361 M) 117.50 (USD 1,813 M)

AUD/USD 0.7400 (AUD 328 M) 0.7500 (AUD 223 M) 0.7545-0.7550 (AUD 723 M)

USD/CAD 1.3165-1.3171 (USD 450 M)

NZD/USD 0.7020 (NZD 460 M) 0.7040 (NZD 398 M) 0.7065 (NZD 334 M)

EUR/USD

Offers 1.0580 1.0600 1.0620-25 1.0650 1.0680 1.0700 1.0725-30 1.0750

Bids 1.0520 1.0500 1.0480 1.0450 1.0420 1.0400

GBP/USD

Offers 1.2180 1.2200 1.2220 1.2250 1.2280 1.2300

Bids 1.2150 1.2125-30 1.2100 1.2080-85 1.2050 1.2030 1.2000

EUR/GBP

Offers 0.8700 0.8720 0.8750 0.8780 0.8800 0.8830 0.8850

Bids 0.8665 0.8650 0.8620 0.8600 0.8585 0.8550

EUR/JPY

Offers 122.85 123.00 123.30 123.60 123.85 124.00 124.30 124.50

Bids 122.20 122.00 121.75 121.50 121.00 120.80 120.50 120.00

USD/JPY

Offers 116.20-25 116.50 116.80 117.00 117.20 117.50-55 117.80 118.00

Bids 115.75-80 115.50 115.20 115.00 114.80 114.50 114.30 114.00

AUD/USD

Offers 0.7400 0.7420-25 0.7450 0.7475 0.7500

Bids 0.7350-55 0.7330 0.7300 0.7280 0.7250 0.7230 0.7200

In November 2016, construction output fell by 0.2% compared with October 2016, largely due to a contraction in non-housing repair and maintenance.

The underlying pattern as suggested by the 3 month on 3 month movement shows a slight contraction of 0.1%.

Repair and maintenance provides the largest downwards pressure to construction output, falling both on the month and year.

The UK's deficit on trade in goods and services was estimated to have been £4.2 billion in November 2016, a widening of £2.6 billion from October 2016, which reflects a £3.3 billion increase in imports, partially offset by a £0.7 billion increase in exports.

The widening of the deficit in November 2016 is attributed to trade in goods in which there were increased imports from both EU and non-EU countries, partially offset by an increase in exports to EU countries.

In November 2016, total production was estimated to have increased by 2.1% compared with October 2016.

The increase in production was due to an increase in mining and quarrying output following the end of a maintenance period in the oil and gas industry and an increase in manufacturing.

The monthly estimate of manufacturing increased by 1.3% in November 2016; the largest contribution came from pharmaceuticals, which increased by 11.4%. Pharmaceuticals can be highly erratic, with significant monthly changes, often due to the delivery of large contracts.

"In Canada, recent strength in building permits should translate into an acceleration in the annual pace of housing starts to 191K. The Bank of Canada business outlook survey released on Monday pointed to an improvement in the outlook for sales, investment and hiring with majority of firms reporting benefits from a stronger US growth outlook although some respondents also highlighted uncertainty about rising protectionism.

Markets have been ignoring risks of US protectionism for the CAD but a potential shift from selective tariffs to a broad border tax could be significant for US-Canada trade and the CAD.

Our fair-value estimates suggest the CAD is expensive. Neither relative rates nor oil prices will provide much support going forward.

We expect the BoC to hold steady next week and with crude oil prices down nearly 4% this week, we believe the dip in USD/CAD will prove unsustainable.

We have added a long USD/CAD exposure to our model portfolio via a 2M 1.37 one-touch option".

Copyright © 2017 Credit Agricole CIB, eFXnews™

Japan's leading index strengthened to the highest level in 15 months in November, survey data from the Cabinet Office showed Wednesday, cited by rttnews.

The leading index, which measures the future economic activity, rose to 102.7 in November from 100.8 in October. This was the highest reading since August 2015, when score was 103.4 and slightly above the expected level of 102.6.

The coincident index improved to 115.1, the highest since March 2014, from 113.5 in October. The coincident indicator reflects the current economic activity. The score was slightly below the expected score of 115.

EUR/USD

Resistance levels (open interest**, contracts)

$1.0700 (2296)

$1.0666 (356)

$1.0641 (253)

Price at time of writing this review: $1.0559

Support levels (open interest**, contracts):

$1.0487 (1131)

$1.0443 (2435)

$1.0387 (3193)

Comments:

- Overall open interest on the CALL options with the expiration date March, 13 is 52492 contracts, with the maximum number of contracts with strike price $1,1500 (3225);

- Overall open interest on the PUT options with the expiration date March, 13 is 60611 contracts, with the maximum number of contracts with strike price $1,0000 (5212);

- The ratio of PUT/CALL was 1.15 versus 1.15 from the previous trading day according to data from January, 10

GBP/USD

Resistance levels (open interest**, contracts)

$1.2410 (305)

$1.2314 (148)

$1.2219 (204)

Price at time of writing this review: $1.2154

Support levels (open interest**, contracts):

$1.2083 (517)

$1.1987 (1797)

$1.1890 (2874)

Comments:

- Overall open interest on the CALL options with the expiration date March, 13 is 16200 contracts, with the maximum number of contracts with strike price $1,2800 (2992);

- Overall open interest on the PUT options with the expiration date March, 13 is 20169 contracts, with the maximum number of contracts with strike price $1,1500 (3214);

- The ratio of PUT/CALL was 1.25 versus 1.27 from the previous trading day according to data from January, 10

* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.

** - Open interest takes into account the total number of option contracts that are open at the moment.