Forex Today: USD sell-off stretches into Asia, a light calendar ahead

A volatile Asian session today, with broad based US dollar weakness remaining the main theme, as investors continued to sell-off the greenback amid widespread risk-aversion. While most of the majors staged a solid comeback taking advantage of some aggressive USD selling.

On the data-front, we had a disappointing session, with the Aus retail sales and Chinese CPI figures, both falling short of expectations.  China December CPI arrived at 2.1% y/y vs 2.2% expected, while Australia's retail sales for the month of November came at +0.2% vs 0.4% expected and 0.5% last. 

Looking ahead, there is nothing much to report in the EUR calendar today, and hence focus shifts towards a couple of relevant macro news due to be reported from the NA session. The Canadian building permits data will be published ahead of the US JOLTS job openings data later today.

Main topics in Asia

Australia's Nov retail sales miss expectations

Australia's retail sales for the month of November came at +0.2% vs 0.4% expected and 0.5% last.

China's Dec inflation figures softer-than-expected

China's December CPI came at 2.1% y/y vs 2.3% exp and 2.3% last, while m/m CPI saw 0.2% vs 0.3% exp and 0.1% last.

One-month & three-month CNH HIBOR slides most since Jan 2016

The one-month and three-month CNH (offshore Yuan) Hong Kong Interbank Offered Rate (HIBOR) dropped 3 points and 1.33 points respectively, most since January 2016.

Aussie stocks drive rest of Asia lower, China CPI weighs

Risk-off sentiment gripped the Asian markets this Tuesday, as most major indices kicked-off on a shaky ground and inched lower, tracking a negative close on their Wall Street counterparts.

Key focus for the day ahead

Russia to start reducing oil output - Interfax

The Russian new agency, Interfax, reporting latest headlines on oil markets, via Reuters, citing that Russia is expected to start reducing oil output in accordance with the OPEC deal.

EUR/USD eases from weekly tops, but keeps 1.06

Going forward, amid a lack of fresh economic data due to be reported in the European session, the sentiment around the US dollar will play a key role ahead of the US second-tier jobs data.

Trouble ahead for the CAD, despite its strong start to 2017 - RTRS poll

Latest Reuters poll of 40 forex experts suggested that uncertainty over the future of the North American Free Trade Agreement (NAFTA) could sink the Canadian dollar to 74.07 cents USD in the next six months. 

BOE Governor Carney faces lawmakers this week - BBG

Bloomberg carries an article on Tuesday, presenting a brief preview of the BOE Governor Carney’s testimony before the Treasury Select Committee on Wednesday, the first one into the New Year, as Brexit concerns resurface.