The New York Federal Reserve released its survey on Thursday. The NY Fed Empire State manufacturing index climbed to 9.5 in January from -1.23 in December, exceeding expectations for a rise to 5.3. December's figure was revised up from -3.6.

The decline was driven by a fall in orders and shipments.

The new orders index climbed to 6.09 in January from a revised reading of 0.39 in December.

The index for the number of employees increased to 13.68 in January from 8.33 last month.

"Indexes for the six-month outlook pointed to widespread optimism about future conditions", the report said.

The U.S. dollar traded mixed to higher against the most major currencies after the mixed U.S. economic data. The he Philadelphia Federal Reserve Bank released its manufacturing index on Thursday. The index dropped to 6.3 in January from 24.5 in December. That was the lowest level since February 2014. Analysts had expected the index to decline to 20.3.

The U.S. producer price index dropped 0.3% in December, in line with expectations, after a 0.2% decrease in November. That was the biggest decline since October 2011.

On a yearly basis, the producer price index increased 1.1% in December, missing expectations for a 1.2% gain, after a 1.4% rise in November.

The decline was driven by a decline in oil prices.

The producer price index excluding food and energy gained 0.3% in December, beating forecasts of a 0.1% increase, after a flat reading in November.

On a yearly basis, the producer price index excluding food and energy climbed 2.1% in December, exceeding expectations for a 2.0% increase, after a 1.8% gain in November.

The number of initial jobless claims in the week ending January 09 in the U.S. rose by 19,000 to 316,000 from 297,000 in the previous week. The previous week's figure was revised down from 294,000. Analysts had expected the number of initial jobless claims to increase to 299,000.

The NY Fed Empire State manufacturing index climbed to 9.5 in January from a revised reading of -1.23 in December, exceeding expectations for a rise to 5.3.

The euro dropped against the U.S. dollar as the Swiss National Bank (SNB) announced today that it will discontinue the 1.20 per euro exchange rate floor.

Investors speculate that the European Central Bank could decide on its policy meeting on January 22 to purchase government bonds.

Eurozone's trade surplus widened to €20.0 billion in November from €19.6 billion in October, missing expectations for a rise to €21.3 billion. October's figure was revised up from a surplus of €19.4 billion.

The increase was driven by a weaker euro and falling oil prices.

The British pound traded lower against the U.S. dollar in the absence of any major economic reports from the U.K.

The Swiss franc traded higher against the U.S. dollar, after dropping in the morning trading session as the Swiss National Bank announced today that it will discontinue the 1.20 per euro exchange rate floor. But the SNB added that will remain active in the foreign exchange market.

The New Zealand dollar traded mixed against the U.S. dollar in the absence of any major economic reports from New Zealand. In the overnight trading session, the kiwi traded higher against the greenback.

The Australian dollar traded mixed against the U.S. dollar. In the overnight trading session, the Aussie rose against the greenback after the better-than-expected labour market data. Australia's unemployment rate fell to 6.1% in December from 6.2% in November, beating expectations for a rise to 6.3%. November's figure was revised up from 6.3%.

The number of employed people in Australia rose by 37,400 in December, exceeding expectations for an increase by 5,300, after a gain by 44,900 in November. November's figure was revised up from an increase by 42,700.

The Japanese yen traded lower against the U.S. dollar in the absence of any major economic reports from Japan.

The Philadelphia Federal Reserve Bank released its manufacturing index on Thursday. The index dropped to 6.3 in January from 24.5 in December. That was the lowest level since February 2014.

Analysts had expected the index to decline to 20.3.

A reading above zero indicates expansion.

The survey said that general activity and new orders are expected to grow moderately.

"Price pressures were reduced and that lower energy prices are having net beneficial effects", the survey said.

The survey's respondents expect weaker labour market conditions in January.

"Firms remain optimistic about increases in overall business and employment over the next six months", the survey showed.

The Swiss National Bank (SNB) President Thomas Jordan said at a press conference on Thursday that the CHF1.20 exchange rate floor has been discontinued because it was unsustainable.

"The euro has depreciated substantially against the US dollar and this, in turn, has caused the Swiss franc to weaken against the US dollar. In these circumstances, the SNB has concluded that enforcing and maintaining the minimum exchange rate for the Swiss franc against the euro is no longer justified", Jordan said.

He added that surprise was necessary.

Jordan pointed out that the overvaluation of the Swiss franc has declined since the introduction of the exchange rate floor but the currency remains high.

The SNB president noted that the SNB will intervene in the foreign exchange markets if required.

Switzerland's central bank will lower the interest rate for sight deposit accounts to -0.75% from 22 January. The target range for the 3-month Libor is being cut by 0.5% to between -1.25% and -0.25%.

The SNB capped the franc at 1.20 per euro in September 2011. It had intervened heavily in 2012 to defend the cap. The Swiss National Bank's foreign exchange reserves increased in December. That indicates that the Swiss National Bank's (SNB) has intervened in currency markets last month.

Jordan also said that inflation in Switzerland is expected to -0.1% in 2015 due to falling oil prices. He added that lower oil prices will stimulate the global economy.

The U.S. Commerce Department released the producer price index figures on Thursday. The U.S. producer price index dropped 0.3% in December, in line with expectations, after a 0.2% decrease in November. That was the biggest decline since October 2011.

On a yearly basis, the producer price index increased 1.1% in December, missing expectations for a 1.2% gain, after a 1.4% rise in November.

The decline was driven by a decline in oil prices. Gasoline prices dropped 14.5%, while food prices fell 0.4%.

The producer price index excluding food and energy gained 0.3% in December, beating forecasts of a 0.1% increase, after a flat reading in November.

On a yearly basis, the producer price index excluding food and energy climbed 2.1% in December, exceeding expectations for a 2.0% increase, after a 1.8% gain in November.

EUR/USD: $1.1770-80(E570mn), $1.1900(E470mn), $1.2000(E1.0bn)

USD/JPY: Y114.80($500mn), Y115.00($550mn), Y116.75($400mn), Y117.50($610mn), Y118.00($592mn)

GBP/USD: $1.5225(stg150mn), $1.5250(stg180mn)

AUD/USD: $0.8200(A$200mn)

NZD/USD: $0.7750($242mn)

USD/CAD: C$1.1750($761mn), C$1.2000($865mn), C$1.2040($429mn)

The German Federal Statistics Office released preliminary gross domestic product (GDP) data on Thursday. The German economy grew 1.5% in 2014, the best performance in three years.

The increase was driven by higher private consumption as employment and wages were higher and inflation was moderate.

Germany's exports increased 3.7% in 2014 versus 1.6% in the previous year, while imports rose 3.3% versus 3.1% gain in the previous year.

Economic calendar (GMT0):

(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual)

00:01 United Kingdom RICS House Price Balance December 13% 11% 11%

00:30 Australia Unemployment rate December 6.2% Revised From 6.3% 6.3% 6.1%

00:30 Australia Changing the number of employed December +44.9 +5.3 +37.4

10:00 Eurozone Trade Balance s.a. November 19.6 Revised From 19.4 21.3 20.0

The U.S. dollar traded mixed to higher against the most major currencies ahead of the U.S. economic data. The U.S. PPI is expected to decline 0.3% in December, after a 0.2% decrease in November.

The number of initial jobless claims in the U.S. is expected to increase by 5,000 to 299,000.

The Philadelphia Federal Reserve Bank' manufacturing index is expected to drop to 20.3 in January from 24.5 in December.

The euro traded lower against the U.S. dollar as the Swiss National Bank (SNB) announced today that it will discontinue the 1.20 per euro exchange rate floor.

Investors speculate that the European Central Bank could decide on its policy meeting on January 22 to purchase government bonds.

Eurozone's trade surplus widened to €20.0 billion in November from €19.6 billion in October, missing expectations for a rise to €21.3 billion. October's figure was revised up from a surplus of €19.4 billion.

The increase was driven by a weaker euro and falling oil prices.

The British pound traded higher against the U.S. dollar in the absence of any major economic reports from the U.K.

The Swiss franc plunged against the U.S. dollar as the Swiss National Bank announced today that it will discontinue the 1.20 per euro exchange rate floor. But the SNB added that will remain active in the foreign exchange market.

EUR/USD: the currency pair declined to $1.1779

GBP/USD: the currency pair increased to $1.5262

USD/JPY: the currency pair fell to $116.23

The most important news that are expected (GMT0):

13:30 U.S. Initial Jobless Claims January 294 299

13:30 U.S. PPI, m/m December -0.2% -0.3%

13:30 U.S. PPI, y/y December +1.4% +1.2%

13:30 U.S. PPI excluding food and energy, m/m December 0.0% +0.1%

13:30 U.S. PPI excluding food and energy, Y/Y December +1.8% +2.0%

15:00 U.S. Philadelphia Fed Manufacturing Survey January 24.5 20.3

EUR/USD

Offers $1.1900, $1.1850-60, $1.1800/03

Bids $1.1625/20

GBP/USD

Offers $1.5400/05

Bids $1.5145/40, $1.5105/00, $1.5055/50

AUD/USD

Offers $0.8300, $0.8250, $0.8200

Bids $0.8150, $0.8110/00, $0.8060/50, $0.8020

EUR/JPY

Offers Y138.00, Y137.50, Y136.80/00

Bids Y135.50, Y135.00, Y134.50

USD/JPY

Offers Y118.00, Y117.50, Y117.15/20

Bids Y116.50, Y116.00, Y115.50

EUR/GBP

Offers stg0.7850/55

Bids stg0.7720, stg0.7700, stg0.7680

Eurostat released trade data for the Eurozone on Thursday. Eurozone's trade surplus widened to €20.0 billion in November from €19.6 billion in October, missing expectations for a rise to €21.3 billion. October's figure was revised up from a surplus of €19.4 billion.

The increase was driven by a weaker euro and falling oil prices.

Exports climbed by 0.2% in November, while imports remained flat.

EUR/USD: $1.1770-80(E570mn), $1.1900(E470mn), $1.2000(E1.0bn)

USD/JPY: Y114.80($500mn), Y115.00($550mn), Y116.75($400mn), Y117.50($610mn), Y118.00($592mn)

GBP/USD: $1.5225(stg150mn), $1.5250(stg180mn)

AUD/USD: $0.8200(A$200mn)

NZD/USD: $0.7750($242mn)

USD/CAD: C$1.1750($761mn), C$1.2000($865mn), C$1.2040($429mn)

The Swiss National Bank announced today that it will discontinue the minimum exchange rate of 1.20 per euro and introduced a negative rate of -0.75% on account balances that exceed a given exemption threshold. The news led to a massive rally of the Swiss Franc versus the single currency. The greenback also slumped after the surprise move and hit new lows. The euro also hit new lows at USD1.1574 in highly volatile trading after the news.

REUTERS

India makes surprise early rate cut, hints at more

(Reuters) - The Reserve Bank of India surprised markets with a 25 basis point reduction in interest rates on Thursday and signaled it could cut further, amid signs of cooling inflation and what it said was a government commitment to contain the fiscal deficit.

While the early move was unexpected, aggressive reductions in rates have been seen as likely over the course of the coming year to help India's economy out of a rut, with growth rates struggling to recover from their weakest levels since the 1980s.

Source: http://www.reuters.com/article/2015/01/15/us-india-cenbank-idUSKBN0KO0DJ20150115

BLOOMBERG

Wall Street Now Sees Oil Around $40

Brace for $40-a-barrel oil.

The U.S. benchmark crude price, down more than $60 since June to below $45 yesterday, is on the way to this next threshold, said Societe Generale SA and Bank of America Corp. And Goldman Sachs Group Inc. says that West TexasIntermediate needs to remain near $40 during the first half to deter investment in new supplies that would add to the glut.

"The markets are continuing to price in huge oversupply in the first half of 2015," Mike Wittner, head of research at Societe Generale SA in New York, said by phone on Jan. 12. "We're going to go below $40."

Source: http://www.bloomberg.com/news/2015-01-14/oil-at-40-and-below-gaining-traction-on-wall-street.html

BLOOMBERG

What, Us Worry? Economists Stay Upbeat as Markets See Trouble

The U.S. consumer, that dynamo of the global economy, just took a step back.

Relax. It's not that bad, economists say.

News Wednesday that U.S. retail sales unexpectedly declined in December reverberated through financial markets, but few economists read the report as a sign of trouble for the nation's economy.

In fact, many economists say the U.S. economy is doing just fine.

So why did the markets react the way they did? The answer, in part, is that the report added to a wall of worry confronting investors. Topping the 2015 angst-list are the plunge in oil and other commodities, as well as slowdowns in China and Europe.

Source: http://www.bloomberg.com/news/2015-01-14/what-us-worry-economists-stay-upbeat-as-markets-see-trouble.html

(Time/ Region/ Event/ Period/ Previous/ Forecast/ Actual

00:01 United Kingdom RICS House Price Balance December 13% 11% 11%

00:30 Australia Unemployment rate December 6.2% 6.3% 6.1%

00:30 Australia Changing the number of employed December +42.7 +5.3 +37.4

The U.S. dollar remained broadly stronger against its major peers, with exception of the Australian and New Zealand's dollar, despite disappointing retail sales data covering the holiday shopping season published yesterday. The euro was under further pressure after Advocate General Pedro Cruz Villalon of the EU Court of justice in Luxembourg said the ECB's Outright Monetary Transactions program is "in principle" in line with European law, backing Mario Draghi's plans for QE after the policy meeting on January 22nd.

Today investors look ahead to data on the NY Fed Empire State manufacturing index and Initial Jobless claims and the Producer Price Index.

The Australian dollar strengthened towards a one-month high on better-than expected job data after the currency was hit yesterday by a plunge of copper prices and dropped the most since January 2^nd. According to official data the Unemployment Rate declined from revised 6.2% in November to 6.1% in December, beating forecasts of a rise to 6.3%. 37,400 new jobs were created in December, analyst expected a rise of 5,300.

New Zealand's dollar traded higher against the greenback. Data on New Zealand's Food Price Index for December had a reading of +0.3% compared to -0.5% in November. On a yearly basis Food Prices rose by 1.0%.

The Japanese yen declined versus the greenback. Bank of Japan Governor Haruhiko Kuroda said that the bank will maintain stimulus measures until inflation is stable at 2 percent as monetary easing has its intended effects. Core Machinery Orders in November grew less-than expected +1.3%, analysts predicted +4.8%. Year on year Orders declined -14.6%, far more than the forecasted -5.8%.

EUR/USD: the euro traded weaker against the greenback

The most important news that are expected (GMT0):

(time / country / index / period / previous value / forecast)

10:00 Eurozone Trade Balance s.a. November 19.4 21.3

13:30 U.S. NY Fed Empire State manufacturing index December -3.6 5.3

13:30 U.S. Initial Jobless Claims January 294 299

13:30 U.S. PPI, m/m December -0.2% -0.3%

13:30 U.S. PPI, y/y December +1.4% +1.2%

13:30 U.S. PPI excluding food and energy, m/m December 0.0% +0.1%

13:30 U.S. PPI excluding food and energy, Y/Y December +1.8% +2.0%

15:00 U.S. Philadelphia Fed Manufacturing Survey January 24.5 20.3

23:50 Japan Tertiary Industry Index November -0.2% +0.3%

EUR / USD

Resistance levels (open interest**, contracts)

$1.1975 (1139)

$1.1918 (2663)

$1.1873 (710)

Price at time of writing this review: $ 1.1761

Support levels (open interest**, contracts):

$1.1707 (2097)

$1.1664 (3787)

$1.1609 (6696)

Comments:

- Overall open interest on the CALL options with the expiration date February, 6 is 50060 contracts, with the maximum number of contracts with strike price $1,2100 (4783);

- Overall open interest on the PUT options with the expiration date February, 6 is 56790 contracts, with the maximum number of contracts with strike price $1,1700 (6696);

- The ratio of PUT/CALL was 1.13 versus 1.14 from the previous trading day according to data from January, 14

GBP/USD

Resistance levels (open interest**, contracts)

$1.5403 (462)

$1.5304 (415)

$1.5307 (396)

Price at time of writing this review: $1.5224

Support levels (open interest**, contracts):

$1.5189 (537)

$1.5093 (1717)

$1.4995 (1166)

Comments:

- Overall open interest on the CALL options with the expiration date February, 6 is 15304 contracts, with the maximum number of contracts with strike price $1,5800 (1108);

- Overall open interest on the PUT options with the expiration date February, 6 is 17195 contracts, with the maximum number of contracts with strike price $1,5100 (1717);

- The ratio of PUT/CALL was 1.12 versus 1.12 from the previous trading day according to data from January, 14

* - 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.

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

EUR/USD $1,1788 +0,14%

GBP/USD $1,5231 +0,47%

USD/CHF Chf1,0185 -0,14%

USD/JPY Y117,32 -0,51%

EUR/JPY Y138,31 -0,38%

GBP/JPY Y178,71 -0,07%

AUD/USD $0,8148 -0,20%

NZD/USD $0,7714 -0,29%

USD/CAD C$1,1950 -0,05%

(time / country / index / period / previous value / forecast)

00:01 United Kingdom RICS House Price Balance December 13% 11%

00:30 Australia Unemployment rate December 6.3% 6.3%

00:30 Australia Changing the number of employed December +42.7 +5.3

10:00 Eurozone Trade Balance s.a. November 19.4 21.3

13:30 U.S. NY Fed Empire State manufacturing index December -3.6 5.3

13:30 U.S. Initial Jobless Claims January 294 299

13:30 U.S. PPI, m/m December -0.2% -0.3%

13:30 U.S. PPI, y/y December +1.4% +1.2%

13:30 U.S. PPI excluding food and energy, m/m December 0.0% +0.1%

13:30 U.S. PPI excluding food and energy, Y/Y December +1.8% +2.0%

15:00 U.S. Philadelphia Fed Manufacturing Survey January 24.5 20.3

23:50 Japan Tertiary Industry Index November -0.2% +0.3%