• EUR/USD remained heavy in Asia, 1.1645-59 EBS, holding above 1.1633 200-DMA

• Capped for now at 1.1659 hourly Ichimoku kijun, tenkan 1.1652 below

• Ascending 200-HMA below at 1.1642, underlining support for now

• Massive nearby option expiries today to again help contain spot action

• At 1.1600 E2.3 bln, between 1.1630-50 E2.6 bln, 1.1660-95 E2.5 bln

• On 1.17 above between 1.1700-65 total E2.4 bln also

• EUR/JPY heavy too, 185.52-63 EBS but above 184.91-185.26 daily Ichi cloud

• 100-DMA 185.15 in cloud, at base of 185.50-74 hourly cloud, 100-HMA 185.44

• E710 mln inn option expiries today at 185.00 strike, likely supportive too

• EUR/GBP tad better bid, indicated at 0.8575, still in 0.8535-92 daily cloud

• EUR/CHF also buoyant, 0.9383-89 EBS, rising with hourly tenkan at 0.9385

• Smattering of option expiries today between 0.9305-15, at 0.9400

• Most EUR flows today likely on last minute position adjusts pre-Jackson Hole

• Related comments , also ,
EUR/USD hourly:


EUR/JPY hourly:


EUR/CHF hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• AUD/USD +0.2% Thur as expectations of Sep RBA hike continue to rise

• AU Q2 capex -3.6% q/q (poll +0.5%), Jul household spending +1.1% m/m

• AUD topside break above 0.7190-00 resistance looks increasingly likely

• Broad USD index & UST yields grind higher on warmer than expected PCE update

• Fed Chair Warsh speech at Jackson Hole Fri looms as late-week focal point

• Range Asia 0.7173-84 support 0.6920 0.6866, resistance 0.7190-00 0.7277-82
DXY Daily 55-DMA


AUD Daily 21/100/200-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• USD/JPY little affected by good US GDP data, elevated US inflation

• Holding in recent range around 159.00, Asia so far today 159.22-30 EBS

• After plunge to 155.20 on August 3, retracement to 159.78 August 18

• Since then, range with base of 158.03 on August 20

• Japanese exporters helping to cap upside, importer demand at Tokyo fixes

• Daily Ichimoku cloud still ascending, today up between 160.63-162.51

• 100-DMA ahead at 159.99, 200-DMA below at 153.40, current parameters?

• Spot to top of 159.08-24 hourly Ichi cloud from 159.44 high yesterday

• 100/200-HMAs in this cloud at 159.09/10, initial support

• Bounce seen from around the 100-HMA, ahead of cloud base yesterday

• Option expiries today include 158.85-90 $798 mln, less at 159.50, 160.00

• JGB-US Treasury rate differentials narrower again, 2s to 249, 10s to 175 bps

• Related comments , , also

• US markets , , ,

• On US economy , one yen view
USD/JPY daily:


USD/JPY hourly:


JGB-US Treasury 2-year interest rate differential:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• NZD/USD -0.5% from Wed 0.59775 high as DXY & UST yields grind higher

• Warmer than anticipated U.S. inflation firms chance of FFR hike by year end

• U.S. Jul PCE index +0.2% m/m, +3.7% y/y (poll +0.1% and +3.6% respectively)

• Fed Chair Warsh speech at Jackson Hole Fri looms as critical focal point

• Futures pricing now implies 98.1% chance of RBNZ 25 bps hike Sep 2

• NZD targeting break above 0.5990-95, expect stop-loss covering above

• Range NZ 0.5941-445, support 0.5831 0.5762, resistance 0.5995 0.6012
NZD Daily 55-DMA


DXY Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD -0.2% from Wed 0.7189 high, resistance too tough on 1st-attempt

• Break above 0.7190-00 zone will put 0.72825 50-month high in cross hairs

• Wed hotter than expected CPI firms RBA rate hike bets, underwrites AUD rally

• U.S. Jul PCE index +0.2% m/m, +3.7% y/y (poll +0.1% and +3.6% respectively)

• USD Index & UST yields slightly higher on firming Fed rate hike bets

• Fed Chair Warsh speech at Jackson Hole Fri looms as late-week focal point

• Overnight range 0.7164-89 support 0.6920 0.6866, resistance 0.7190-00 0.7282
AUD Daily 21/55/100-DMA


AUD Weekly 52-WMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

MUFG Research discusses USD/JPY outlook into Fed Warsh's speech at Jackson Hole on Friday.

"Jackson Hole remains important from a Fed perspective. If there is no strong steer by Warsh on a hike in September (which seems likely) we would likely see front-end rates soften a little in the US and coupled with strong expectations of a BoJ rate hike could provide some impetus for a further decline in USD/JPY. Buying momentum certainly looks to be fading once again," MUFG notes.

"Yen strength is evident in the non-dollar crosses today but if the Fed manages to remain on hold in September that yen strength should also become evident versus the US dollar as well," MUFG adds.

• AUD holds constructive during NY trade, +0.2% at 0.7170

• 0.7200 remains the near-term topside objective for bulls

• A break through here would expose the year-to-date high at 0.7277

• US PCE came in a touch firmer than expected, lifts USD and U.S. yields, providing some resistance for AUD/USD

• Uptrend intact with spot holding above the 200-hour MA cluster at 0.7130

• That said, AUD strength is still better expressed via AUD/NZD. Potential for return to 0.7200
AUDUSD hourly chart


Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

• GBP$ soft in NY afternoon trade, -0.40% at 1.3593; NorAm range 1.3648-1.3584

• Support by recent low area near 1.3620 gives way, bears test lows sub-1.36

• US PCE HL data a touch above f/c lift belly of UST curve yields and USD

• Next key event is Friday's Fed Chair Warsh address at KC Fed Jackson Hole Symposium

• Near-term Fed-BoE policy expectations inline, both seen hiking 25bp by Dec meetings

• GBP$ supt 1.3585/84 Wed low/10-DMA, 1.3523 rising 21-DMA, 1.3475 daily low Aug 13

• Res 1.3648 Wednesday high, 1.3675 daily high Aug 21, 1.3712 daily high Feb 11

GBP$ Chart:


(Paul.Spirgel is a Reuters market analyst. The views expressed are his own)

• Euro tracking sideways with a softer undertone as dollar firms following U.S. PCE

• Core metrics were in-line, headline a touch hotter than f/c, lifting USD and U.S. yields

• Euro shrugged off hawkish ECB Schnabel remarks. Sept hike priced in, so rhetoric does little to move the needle

• Initial support at the 200-hour MA cluster (1.1640), keeping the pair supported for now

• Flow dynamics set to shift the dollar's favour on Thursday, increasing downside risk

• A clean break through 1.1640 would open 1.1615, a move below that likely brings last week's low into view (1.1557)
EURUSD hourly chart


Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

ANZ Research discusses NZD outlook into this week's Jackson Hole and next week's September RBNZ meeting.

"On inflation, the July Selected Price Index data, which covers nearly half of the quarterly CPI basket, came in a little cooler than we anticipated. That presents a minor downside risk to our forecast for a 3.9% y/y rise in Q3 but failed to illicit a meaningful or sustained market reaction. Overall, OIS pricing for a September hike remains around 23bp of hikes for that meeting," ANZ notes.

"Given that this week’s Jackson Hole symposium is too close to the next RBNZ meeting on 2 September, Governor Breman will not take interviews. That leaves little commentary to sway the NZD. We are slightly positive on the NZD/USD. We see net short positioning as having scope to wind back and offer some support for the NZD," ANZ adds.

• Shares of gold miners down, tracking lower bullion prices [GOL/]

• Spot gold fell 1% to $4,369.82/ounce, after prices climbed to their highest since May 14 on Tuesday

• Gold prices fall after U.S. inflation data was largely in line with expectations on Wednesday, increasing bets on a Federal Reserve interest-rate hike next month, while investors also awaited remarks from Chairman Kevin Warsh this week

• Top miners Barrick Mining and Newmont down between 0.8% and 2%, respectively

• South African miners Gold Fields down 1.5%, Harmony Gold slips 1.8% and AngloGold Ashanti falls 3.7%

• Canadian miners Agnico Eagle Mines and Kinross Gold down between 1.1% and 1.6%

(Reporting by Varun Sahay in Bengaluru)

Morgan Stanley Research sees a scope for EUR/USD to rise above 1.20 on the UST buyback program.

"The return of this US currency policy narrative could push EUR/USD back to a roughly 3% premium to its yield-implied level in the near term. Given that current levels of 2y German-US yield differentials are consistent with EUR/USD around 1.18, we see room for EUR/USD to rise toward 1.2150 if yields remain stable," MS notes.

"Given our continued expectation for relatively subdued FX volatility, we expect this shift to unfold over time. We continue to expect AUD to outperform given its elevated carry and relatively clean positioning," MS adds.

Sterling's fall below the 1.3620 support area suggests bullish sentiment for the pound is facing a key test as late-summer market liquidity dries up and the Fed's Jackson Hole Symposium looms.

GBP/USD is still holding above the crucial 1.3600 big-figure support level, but repeated failures to sustain gains in the mid-1.36s and the inability to break past Friday's six-month high of 1.3675 could signal a capitulation among sterling bulls.

Even with the pound's 3% climb from its July 28 low below 1.33, net speculative short positioning in the IMM futures has only marginally decreased, moving from -64.8k contracts to -54.6k by August 18, indicating the bullish phase may be transitory.

While evolving Fed-BoE policy expectations have recently leaned in sterling's favor, with futures markets pricing in similar hiking paths for both central banks by 2026, a more hawkish UK rate rate outlook for 2027 has offered some support to the pound.

This narrative, however, might lose its impact when traders return from summer holiday. Persistently high oil prices, without a clear path to U.S.-Iran peace or increased oil flow from the Strait of Hormuz, are likely to delay the disinflationary trend and, consequently, influence the timing of policy adjustments by both the Fed and BoE.

Elevated fiscal concerns in the U.S. and UK remain a factor. While the change in UK leadership initially eased some British fiscal worries, the Autumn Budget in October looms over sterling's outlook.

GBP/USD finds support at 1.3600, below which bears may target the rising 10-day moving average at 1.3586.

Otherwise, cable bulls may be hoping for a dovish statement from Fed Chair Kevin Warsh at Jackson Hole to renew their push above the recent high of 1.3675 and bring the February 11 high of 1.3712 into focus. However, without a decline in U.S. inflation expectations, a dovish stance from Fed policymakers more broadly appears unlikely.
GBP Chart:


(Paul Spirgel is a Reuters market analyst. The views expressed are his own)

Goldman Sachs previews Fed Warsh's speech at Jackson Hole on Friday.

"We expect Warsh to reiterate his commitment to the 2% inflation target, expand on the rationale behind his approach to Fed communication, and offer thoughts on some bigger picture topics such as productivity growth or shocks to the global economy that he alluded to at his last press conference," GS notes.

"He is likely to acknowledge the better recent inflation news but is unlikely to provide policy guidance. The theme of this year's symposium is "Financial Innovation: Implications for Payments and Policy." A full schedule will be posted on Thursday night. The papers are likely to discuss topics such as stablecoins and should have little immediate relevance to monetary policy decisions," GS adds.

Credit Agricole CIB Research highlights the signals from its month-end fixing model.

"Global equity markets were broadly firmer in August. In FX, the USD was broadly weaker on the month.

Overall, the moves in equity markets, when adjusted for market capitalisation and FX performance this month, suggest month-end portfolio-rebalancing flows are likely to be mild USD selling across the board with the strongest sell signal in the case of the USD vs the JPY," CACIB notes.

By Justin McQueen

Aug 26 (Reuters) - Australian monthly inflation data came in hotter than expected, forcing a hawkish repricing in AU rates and prompting local banks to pencil in another RBA hike by year-end. AUD firmer as a result, but as flagged previously, the cleaner expression remains via the crosses, in particular, AUD/NZD, which looks to have established a floor around 1.1900.

Markets are now pricing around 20bps of tightening by the November RBA meeting, up from around 11bps pre-CPI. Note that November is the next scheduled decision where the RBA updates its forecasts, and policymakers will also have the Q3 inflation figures – due October 28 – in hand to validate another move.

With RBA hike odds growing and the bar for a dovish NZ repricing low, especially given the event risk ahead - most notably the NZ general election scheduled for November 7 - AUD/NZD has room to retest 1.2200 and beyond, potentially hitting a fresh year-to-date high. Thus, the cross remains the preferred avenue for AUD strength, given that it also sidesteps the USD noise.
rba PRICING SHIFT


Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

Aug 26 (Reuters) - USD/CAD could be set for a much bigger recovery due to a combination of technical and fundamental factors, putting shorts in danger.

USD/CAD recently failed to sustain the break below the 1.3817 Fibo, a 61.8% retrace of the 1.3551 to 1.4248 (May to June) rise, which had hinted at a rejection of the downside. That equatesto a bear trap, which is set when a market breaks below a technical level but subsequently reverses, and is usually a bullish sign. USD/CAD has extended gains for a third consecutive day after Ottawa hit back on Tuesday with retaliatory tariffs on about $20 billion worth of U.S. annual imports and rolled out aid for businesses and workers, after trade talks with Washington collapsed last week. There is scope for a bigger USD/CAD recovery to the 1.3930 Fibo, a 38.2% retrace of the 1.4248 to 1.3734 (June to August) fall. A break and daily close above that level would be a very bullish sign.
Daily Chart


(Martin Miller is a Reuters market analyst. The views expressed are his own)

• USD/JPY has slipped from 159.26 to 158.89, on Wednesday, EBS data shows

• Japanese exporters seemed to have leaned heavily on USD/JPY in Asia

• A large upper shadow on Tuesday's candlestick line weighs for now

• However, the downside will likely be limited, at least in the near-term

• Spot last week found support at 158.03 Fibo, a 38.2% retrace of the 155.20-159.78 rise

• Note both the USD/JPY and EUR/JPY usually struggle in August

Daily Chart


(Martin Miller is a Reuters market analyst. The views expressed are his own)

• AUD/USD rose to 0.71865 in Asia, its highest level since June 2

• Ascent spurred by hotter than expected Australian July inflation data

• Headline CPI 3.5% vs 3.3% forecast; trimmed mean 3.6% vs 3.5% f/c

• ANZ now tips 25 bps RBA cash rate increase to 4.6% in November

• 0.7160 was AUD/USD low in Asia, before the Australian inflation data

• U.S. July PCE data due at 1230 GMT; 3.6% f/c. Core PCE f/c 3.3%

AUDUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• Cable has traded an 18.5 pip range thus far Wednesday; 1.36295-1.3648

• Those parameters are within Tuesday's 1.36225-1.36549 range

• Tuesday's range was itself within Monday's range; 1.3621-1.36555

• 1.3619-1.36745 was last Friday's range (six-month high before low)

• Ofgem announces UK energy price cap to rise by 4% from October

• UK inflation expectations rise in August, Citi/YouGov survey shows

GBPUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• EUR/USD 21-DMA 1.1576 crosses over 100-DMA 1.1575 - bullish

• Traders are short euros equivalent to $8.5 billion

• EUR/USD has risen 1.1353 to 1.1711 while traders short

• Dips from Aug peak have been shallow ahead 200-DMA at 1.1632

• Targets for bigger rise: 1.1735, 1.1788, 1.1830, 1.1872

•
EURUSD


(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• Hong Kong shares of Jiangxi Copper jump 13.9% to HK$41.36

• Stock on track for the biggest one-day pct gain since February 2021

• Stock hits the highest point since June 22, snapping two straight sessions of decline

• China-based copper and gold mining group said H1 net profit up 106.77% y/y in accordance to China's accounting standards, with revenue up 19.53% y/y

• Shanghai-listed stock jumps 10% to 48.57 yuan, the highest level since August 11

• YTD, Hong Kong stock down 5%, Shanghai shares down 11.6%

(Reporting by Donny Kwok)

• GBP/USD drifts slightly lower in Asia after closing 0.1% higher on Tuesday

• Consolidation below 6 1/2-mth 1.3674 Friday high likely ahead of key events

• U.S.-Iran talks hopes, lower oil, better risk appetite support GBP in Asia

• Oil prices slide 2% on Iran-Oman talks to reopen Strait of Hormuz

• Focus shifts to U.S. July PCE price index, final Q2 GDP, Nvidia results Wed

• Fed Chair Warsh's Jackson Hole address Friday key for markets

• UK inflation expectations rise in Aug after recent falls- Citi/YouGov survey

• One in three UK employers have cut entry-level jobs, survey shows

• Series of higher lows since August 19 positive for technical outlook

• Resistance 1.3690-1.3700, 1.3715-20. support 1.3620-25, 1.3595-1.3600

• Tuesday range 1.3622-1.3655, Asia 1.3641-1.3648
GBP:

(Krishna Kumar is a Reuters market analyst. The views expressed are his own.)

• USD/JPY seeing some heated sales in Tokyo, no doubt Japanese exporters in

• Nikkei up bit today but recently weak, foreign investor ccy hedge sales too?

• Nikkei in 65.390.55-66.109.77 range today, above 64,609.47 low yesterday

• Managing to hold above 64,272 ascending 100-DMA, below 66.061-903 Ichi cloud

• USD/JPY from 159.26 to 158.89 EBS, still between 158.39/159.98 200/100-DMAs

• Tracking away from 159.99-161.97 daily Ichi cloud, into 158.83-159.08 hourly

• Break below hourly cloud bearish, could see push towards 200-DMA

• Effect of news BOJ Gov Ueda won't attend Jackson Hole being digested

• Fresh health problems? Unwilling to face criticism on lack of rate hikes?

• Related comment , also

• On BOJ Ueda , , for more click on [FXBUZ]

USD/JPY hourly:


Nikkei 225 daily:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)