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The US capture of Venezuelan leader Maduro and his wife is the key talking point today. The immediate market fallout has been minimal. Oil prices are little changed. The dollar is mostly firmer against the major currencies and most emerging market currencies. The PBOC set the dollar’s reference rate at a new low since October 2024. Equities are mostly higher and benchmark yields softer.  
 

Prices:   

G10

• The euro extended its pullback that began on Christmas Eve and with today’s losses to almost $1.1670, met the initial retracement objective of its rally since late November. Nearby support is seen near $1.1650, while initial resistance may be encountered in the $1.17 area.

• After reaching JPY157.30 in early local trading, a two-week high, the greenback reversed lower end was sold back to last Friday’s low (~JPY156.50). A break signals a test on JPY156.20 and maybe JPY155.75. 

• Sterling is little changed in a roughly $1.3415-$1.3475 range. It held support near $1.3400 but needs to rise above $1.3500 to lift the tone. The highs from late December were set in the $1.3530-50 area. 

• The US dollar bottomed against the Canadian dollar on December 26 near CAD1.3645. It reached almost CAD1.3750 before the weekend and almost CAD1.3790 today. Technical resistance and retracement objectives are found in the CAD1.3790-CAD1.3805 area. 

• The Australian dollar found support near $0.6665, near the 20-day moving average, and recovered to almost $0.6690 in the European morning. The high before the weekend was a little above $0.6705.  
 

EM: 

• MXN reached a high for the year last week as the US dollar was sold slightly through MXN17.87 before the weekend. The greenback held above MXN17.90 and briefly traded above MXN18.03, its highest level since mid-December. A close above MXN18.00 could signal a corrective phase. 

• The PBOC continued its campaign of lowering the dollar at the daily fix. Today’s reference rate was set at CNY7.0230. However, against the offshore yuan, the dollar held the pre-weekend low near CNH6.9665 and reached about CNH7.9830. On the other hand, against the onshore yuan, the dollar gapped lower, fell to a new low of CNY6.9780 before stabilizing. The low from December 31 was CNY6.9870. 

• The dollar rose to INR90.2925, its highest level since December 19. Near-term potential may extend to INR90.44.

• Indications suggest the dollar initially rose by about 2.75% against the Venezuelan bolivar. 
 

Other Markets: 

• Equities: Global equities are higher. All the large bourse in the Asia Pacific region but Hong Kong rose by more than 1%. South Korea’s Kospi led with a 3.4% surge. Europe’s Stoxx 600 is about 0.35% higher and US index futures are firmer, led by around a 0.65% gain in the Nasdaq futures and a 0.3% gain in the S&P 500. 

• Benchmark 10-year yields: Yields rose six basis point in Japan while easing four basis points in Australia. European benchmarks are mostly a couple of basis points lower, while the 10-year US Treasury yield is off around three basis points to softer to about 4.16%.

• GOLD is higher, and reached nearly $4440, its highest in about five sessions. The record high seen late last year was near $4550. 

• February WTI fell to $56.30, its lowest level since December 19 before recovering to almost 57.75. The high from the last trading day in 2025 was near $58.55.  

Drivers: The dollar is trading firmer against most of the G10 currencies, with the yen and sterling proving the most resilient and posting minor gains. We had been looking for a firmer dollar before the Venezuelan events. 
 

Data:

• In the week that culminates with the US December jobs report, the US sees the ISM manufacturing PMI and December auto sales today. The ISM has been below the 50 boom/bust level since February and slipped to 48.2 in November, the second lowest reading in 2025. American auto sales increased in 20025. Through November, the average annualized pace was 16.13 mln compared with 15.68 mln in the first 11 months of 2024. The threat of tariffs may have encouraged auto purchases ahead of the levy. 

• The UK reported consumer credit and mortgage data earlier today. The data were mixed with November consumer credit stronger than expected, and while net mortgage lending edging higher, the number of mortgage approvals eased.

• Japan saw the final manufacturing PMI. At 50.0, it was slightly better than the preliminary 49.7, it is the best since the 2025 high was recorded in June at 50.1.

• China finished its PMI releases, with the RatingDog (formerly Caixin) services and composite reports. Services ticked lower to 52.0 from 52.1, while the composite reading edged up to 51.3 from 51.2. The week’s highlight is Friday’s December CPI and PPI. 

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