Archives of “January 2020” month

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EUR/USD 1-year implied volatility falls to a record low

  
Analysis, Forex

Volatility continues to dry up in the major currencies space

EUR/USD volatility

The 1-year implied volatility falls to a record low of 5.42% and the trading range today epitomises the above sentiment rather perfectly. EUR/USD rests in just a 9 pips range today and the trading year ahead may see another snoozefest in terms of the overall range.
Euro area economic growth continues to remain sluggish but there isn’t any imminent signs of a major recession just yet. Meanwhile, the ECB is not likely to do anything this year and the Fed is also signaling more of a pause over the coming quarters.
Persistently low growth, low inflation and a global tilt towards more easing policy is likely to make 2020 yet another year of sideways trading – for the most part – in EUR/USD.
The overall range last year was a measly 691 pips. I wouldn’t be the least bit surprised if we do manage to beat that in trading this year.

China’s car sales slump – bottoming out?

  
  Analysis

Sales of new vehicles are an indicator for the economy in China, and elsewhere.

ICYMI, data out Thursday in China showed sales of passenger vehicles (these include sedans, sport utility vehicles, minivans and multipurpose vehicles) fell 7.4% in 2019 from 2018 (to 20.7 million vehicles)
  • passenger car sales fell 3.4% y/y for December month alone, the 18th monthly drop in the past 19 months
Caixin has the report and they add:
  • but the pace of declines has slowed for four consecutive months
and cite comments expecting the slump in sales to ‘bottom out’ soon.
Here is the link to Caixin for more
Expecting a rebound is probably not too optimistic, Chinese authorities are providing economic stimulus.
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