North America Summary and Highlights 12 Jan

North American session
The USD fell back sharply through the North American session, responding to weaker than expected PPI data. USD/JPY was the biggest mover, falling a big figure to trade below 144.50, but the AUD and CHF also made strong gains. EUR/USD and GBP/USD gains were more modest, as European yields matched the decline in US yields on the data, with EUR/USD only rising around 30 pips. 
US PPI fell 0.1% m/m in December against market expectations of a 0.1% rise, with core similarly below consensus at flat against 0.2%. 
European morning session
The USD moved slightly higher in a quiet European morning session. EUR/USD fell 20 pips to 1.0960, and AUD and GBP were also lower, in line with the EUR move. However, the CAD strengthened with USD/CAD down 20 pips, perhaps benefiting from the higher oil price, which rose around $5 on the morning. EUR/NOK was also a little softer, down to 11.27 from 11.30. USD/JPY was little changed at 145.10. 
The rise in the oil price was related to the US and British air strikes on Houthi military targets in Yemen, in response to the attacks by the Houthis on Red Sea shipping. 
The main data of the morning was the UK November GDP data, which showed a rise of 0.3% m/m after the 0.3% decline in October. While this was slightly stronger than expected, the underlying trend remains weak and there is still a significant risk of a negative Q4. EUR/GBP initially edged slightly lower in response, but was little changed on the session.