Forex Today: Asia cheers upbeat China data, UK CPI, ZEW eyed

The Asian markets witnessed a major turnaround in risk sentiment following the release of better-than expected Chinese retail sales and industrial production data. Hence, the yen stalled its overnight rebound and fell back in the red zone, sending USD/JPY back beyond 115 handle. Meanwhile, the Aussie failed to benefit from risk-on trades and remained capped below 0.75 handle post-China data releases.  

Later in the European session, we have the UK CPI and PPI figures, followed by the German ZEW economic sentiment data, which will be eyed closely by the GBP and EUR traders. While a data-light US docket should shift markets’ attention towards Wednesday’s Tankan manufacturing indices due out in the Asian morning.

Also, markets are expected to turn cautious in the day ahead, as the 2-day FOMC meeting will commence in the American session.

Main topics in Asia

Australia's business survey: Business conditions dropping back further in Nov

Today's NAB Australia business survey showed business conditions deteriorate from 7 in Oct to 5 in Nov, while business confidence went up from 4 in Oct to 5 in Nov. 

UK press: UK’s FinMIn Hammond 'backs a slower Brexit'

UK’s CityAm carried an article on the front-page, noting that the UK’s finance minister Hammond is in favor of a slower Brexit.

Russia delays meeting with oil producers

As per Reuters report, the meeting between Russia’s largest oil producers and the energy commission to discuss the implementation of the 300K output cut has been postponed.

China's Nov data dump beats expectations

China's data dump came better-than-expected in November, especially retail sales, which saw a positive deviation of 0.7p.

Key focus for the day ahead

UK: Busy Week with BoE in focus – BBH

Research Team at BBH suggests that while the Federal Reserve meeting is the highlight this week, the UK has a number economic reports and the Bank of England's Monetary Policy Committee meets.  

EUR/USD off-highs, flat-lined around 1.0630 ahead of ZEW

Later today, the spot will get influenced by the German ZEW economic surveys, with the headline economic sentiment figure for Dec expected to improve to 14.0 versus 13.8 last. 

Outlook for AUD/NZD and antipodean rates - Westpac

Analysts at Westpac offered an outlook for AUD/NZD and antopodean interest rates.

Market expectations ebb for additional BOJ easing - Nikkei

The Nikkei Asian Review published an article on Tuesday, suggesting that expectations of further BOJ easing have faded thanks to the central bank’s new policy framework of yield curve control and increased expectations of higher fiscal spending in Trump’s presidency.