European Summary and Highlights 12 Jan

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.
Asia session
Geopolitical conflict once again seize the headline again as the U.S. and UK launched airstrikes against Houthi targets in Yemen while Australia, the Netherlands, Bahrain, and Canada supported. Soon after the airstrike report, the United States Embassy in Iraq was also reported to be bombed, looking like a tit for tat retaliation. The market reaction so far has been muted as we see gold and JPY higher while risk asset tilts negative. USD/JPY is trading 0.14% lower at 145.07 despite U.S. Treasury Yields outperform JGB yields.
The Chinese headline trade balance showed a surplus of  540.9bn (CNY) with both export and import rising. Export rose by 3.8% y/y from 1.7% and import increase by 1.7% y/y from 0.6%. CPI continue to contract y/y by 0.3% but better than 0.4% expected. The stronger than expected Chinese data seems to have outweighed shaky risk sentiment and supported the Antipodeans. AUD/USD is trading 0.17% higher at 0.6699, NZD/USD is trading 0.11% higher at 0.6240 while USD/CAD slipped 0.12% as oil almost up another dollar on geopolitical tension. Elsewhere, EUR/USD is 0.02% stronger and GBP/USD is 0.05% higher.