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EUR / USD
GBP / USD
USD / JPY
USD / CAD
AUD / USD
NZD / USD
USD / CHF
AUD / JPY
AUD / NZD
EUR / CHF
EUR / GBP
EUR / JPY
GBP / JPY
By Catherine Tan  —  Jun 24 - 07:25 PM
  • USD/SGD opens lower, retreat in USD/JPY weighed on DXY nL1N3IM0UL

  • DXY last at 105.51, traded 105.37-90 range yesterday

  • 10yr UST yield -1bp to 4.25%, awaits May inflation data on Fri nL1N3IM0TM

  • USD/SGD traded 1.3514-35 range in NY, closed at 1.3529

  • Supports at 1.3487 200dma, 1.3440; resistance at 1.3560, 1.3600

  • Related nL1N3IM134

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Jun 24 - 03:00 PM

Synopsis:

SocGen expresses skepticism about EUR/USD rising above 1.08 in the very near-term. The focus is on the upcoming US core PCE deflator data, which the Fed targets. Despite some recent positive economic surprises, the current market environment and broader sentiment suggest limited potential for significant gains in the EUR/USD pair.

Key Points:

  1. US Core PCE Deflator Data:

    • The core PCE deflator is crucial as it is targeted by the Fed, though core CPI is deemed more informative.
    • SocGen doubts the market will gain substantial insights from this data release.
  2. Downbeat Economic Expectations:

    • Recent IFO data confirms a downward trend in expectations, mirroring PMI results.
    • The uncertainty surrounding the French elections may be contributing to increased caution and uncertainty.
  3. EUR/USD and Yield Differential:

    • A regression analysis of EUR/USD against the OAT/Bund yield differential suggests that EUR/USD could be heading towards parity.
    • The fact that EUR/USD is not at parity indicates a market already heavily invested in USD, with limited potential for further euro selling.
  4. Market Sentiment:

    • The existing long positions in USD reflect a belief in US exceptionalism.
    • Despite a slight Monday morning bid for EUR/USD, SocGen remains doubtful about the pair reaching 1.08 or higher in the near-term.

Conclusion:

SocGen remains cautious on EUR/USD, doubting it can rise above 1.08 in the near-term. The economic data and broader market sentiment, including the influence of French political uncertainty and a heavily USD-long market, suggest limited upside potential for the euro against the dollar.

Source:
Société Générale Research/Market Commentary
By Burton Frierson  —  Jun 24 - 02:55 PM

The dollar eased against the other majors on Monday, taking a breather from its recent rally as the market pondered Japan intervention risks while UK data helped sterling at the margins.

However the direction of travel has been mostly in the dollar's favor recently, and it remains to be seen if that is changing, especially with French and UK elections on the horizon.

The dollar also faces some risks this week, with PCE -- a favorite inflation indicator of the Fed -- due on Friday and expected to show a renewed retreat in the rate of price growth.

San Francisco Federal Reserve Bank President Mary Daly said she does not believe the U.S. central bank should cut rates before policymakers are confident that inflation is headed toward 2%.

Daly also said that the U.S. central bank must "exhibit care" as it aims to finish the job of bringing inflation under control, noting that rising unemployment is increasingly a risk.

EUR/USD made a fleeting foray above the 10-DMA but retreated back down below it by New York afternoon trade without making a run at the 55-DMA and other moving averages beyond there.
It was, however, still solidly positive on the day.

USD/JPY recouped much of the day's earlier losses that had pushed it down to as far as 158.75.
It was last sitting at 159.65.

GBP/USD struck a high of 1.2698 before backing off without probing the 10-DMA above there.

U.S.
Treasury yields were little changed on the day, holding within recent ranges.

The S&P 500 was down 0.08% after surrendering earlier gains.

WTI rallied 1.16% on the prospect of strong summer driving demand and as tensions in the Middle East and drone attacks on Russian refineries led to concerns about supply.

Copper eased 0.2%, pressured by subdued demand in top consumer China and a significant upturn in deliveries to warehouses approved by the London Metal Exchange, while some support was provided by the softer dollar.

Gold firmed 0.57%, also helped by the retreating U.S. currency.

Heading toward the close: EUR/USD +0.37%, USD/JPY -0.14%, GBP/USD +0.32%, AUD/USD +0.22%.

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Paul Spirgel  —  Jun 24 - 01:35 PM
  • GBP$ firm in NorAm afternoon +0.3% at 1.2680; Monday range 1.2698-33

  • UK gilt yields outpace slight UST yield gain; traders unwind Friday shorts

  • Enjoy the sterling rally while it lasts nL1N3IM0L4

  • UK elections tipped to Labour, falling UK inflation/growth may cap gains

  • Upcoming UK/US Q1 GDP, U.S. core PCE price index Friday key data

  • GBP$ res 1.2698 Mon high, 1.2710 falling 10-DMA, 1.2741 50% of 1.2860-1.2622

  • A cls above 1.2741 shifts control to GBP bulls, though res firm above 1.28

  • Supt at 55-DMA by 1.2620, 1.2596 daily cloud base, 1.2558 200-DMA

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Jun 24 - 01:30 PM

Synopsis:

ING highlights the potential for more risk premium build-up in EUR/USD as political uncertainty looms ahead of the French parliamentary elections. Marine Le Pen’s far-right RN party is leading in the polls, which is contributing to a cautious outlook for the euro.

Key Points:

  1. Polls and Political Uncertainty:

    • Marine Le Pen’s far-right RN party leads with 35% in latest polls.
    • The left-wing NPF party follows with 29%, and President Macron’s centrist coalition holds 19%.
    • Political uncertainty is likely to persist, affecting euro sentiment.
  2. Risk Premium in EUR/USD:

    • As of Friday’s close, the EUR/USD risk premium was estimated at 0.9%.
    • This is below the 2.4% peak on 14 June and the 1.8% historical benchmark identified by ING.
  3. Bond Market Indicators:

    • The 10-year OAT-Bund spread widened to a new peak of 82bp on Friday.
    • Further pressure on French bonds is expected as the vote approaches.
  4. Market Sentiment:

    • ING sees risks skewed to the downside for EUR/USD before the weekend’s political events in the US and the EU.
    • Political developments in France are likely to keep a lid on the euro in the near term.

Conclusion:

ING anticipates more risk premium build-up in EUR/USD ahead of the French parliamentary elections. The leading position of Marine Le Pen’s far-right party and the resulting political uncertainty are expected to weigh on the euro, with potential further pressure on French bonds and downside risks for EUR/USD leading into the weekend’s events.

Source:
ING Research/Market Commentary
By Christopher Romano  —  Jun 24 - 01:15 PM
  • NY opened near 0.6650 after 0.66265 traded overnight, pair fell early

  • 0.6635 neared but buyers emerged as US yields US2YT=RR, US$ softened

  • Stocks ESv1, gold HGv1 & copper HGv1 rallied; USD/CNH fell to 7.2771

  • AUD/USD rallied to 0.66675, pulled back & neared 0.6655 late, was up +0.20%

  • US yields, US$ bounces helped AUD/USD, riskier assets pull back from highs

  • Techs lean bullish; daily RSI rising, pair above 10- & 21-DMAs

  • US April CaseShiller housing, June consumer confidence are risks Tuesday

  • Remarks from Fed's Bowman, Cook may impact risk on Tuesday

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Jun 24 - 10:36 AM

Synopsis:

Bank of America (BofA) expects that the Ministry of Finance (MoF) in Japan may intervene to support the JPY if the USD/JPY pair continues to rise. They suggest that the MoF's intervention threshold has shifted to a range between 160 and 165, with 165 being the new critical level.

Key Points:

  1. Potential for MoF Intervention:

    • BofA anticipates that the MoF may step in to support the JPY if the USD/JPY exchange rate continues to increase.
    • The intervention threshold is suggested to be above 160 and below 165, with 165 being the critical level.
  2. Gradual Rise in USD/JPY:

    • The current rise towards 160 in USD/JPY has been more gradual compared to the rapid increase seen in the spring.
    • This gradual movement might influence the MoF's decision on when to intervene.
  3. Containment of USD/JPY:

    • BofA believes that the MoF can manage and contain the USD/JPY exchange rate for the remainder of 2024.
    • The intervention is expected to occur within the specified range to prevent excessive depreciation of the JPY.
  4. Implications of Intervention:

    • The intervention by the MoF would likely involve selling Treasuries outright, as implied by Japan's reserve data from May.
    • This strategy aims to stabilize the JPY and prevent it from breaching the new critical level of 165.

Conclusion:

BofA projects that the MoF's intervention threshold for the USD/JPY exchange rate has shifted to between 160 and 165, with 165 as the new critical level. The gradual rise towards 160 and the potential for further depreciation necessitates close monitoring. The MoF is expected to intervene to contain the exchange rate within this range for the rest of 2024, reflecting a strategic move to support the JPY amidst fluctuating market conditions.

Source:
BofA Global Research
By Rob Howard  —  Jun 24 - 09:35 AM
  • Cable rises to 1.2681 (high since Thursday) as M&A news lends support to GBP

  • PepsiCo to waive clause in bottling deal as Carlsberg eyes Britvic bid

  • This could pave way for Danish brewer's GBP 3.1 bln Britvic bid to be raised

  • Offers may emerge pre-1.27 if GBP/USD extends north (1.2633 was Asia low)

  • 1.2695 was low before Thursday's dovish hold from BoE - which hurt GBP

  • Biden-Trump presidential debate this week. UK election next week (July 4)

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Jun 24 - 09:32 AM

Synopsis:

Following the June SNB policy meeting, Credit Agricole sees potential in shorting CHF against other safe-haven currencies like JPY and USD. The outlook considers ongoing European political developments, particularly in France, as a significant factor influencing EUR/CHF.

Key Points:

  1. CHF Weakening Post-SNB Meeting:

    • The Swiss Franc (CHF) weakened following the recent SNB policy meeting.
    • The market is assessing whether this weakness will persist, especially against the EUR.
  2. Influence of French Political Drama:

    • Political uncertainties in France are expected to be a key driver of EUR/CHF movements rather than relative SNB monetary policies.
    • The SNB's best hope might be to stabilize or put a floor under EUR/CHF amidst these political developments.
  3. Attractiveness of CHF Shorts:

    • CHF shorts remain attractive against other safe-haven currencies such as the Japanese Yen (JPY) and the US Dollar (USD).
    • This strategy is particularly relevant in light of the SNB meeting's outcomes and the broader market context.
  4. Focus on European Political Developments:

    • With a lighter Swiss economic data calendar next week, European political events will play a more critical role in driving CHF movements.
    • Investors should pay close attention to these political developments as they could significantly impact the CHF.

Conclusion:

Credit Agricole suggests that shorting CHF against JPY and USD could be a viable strategy following the June SNB meeting. While the CHF has weakened, the persistence of these losses will largely depend on European political developments, particularly in France. As the Swiss data calendar lightens, the focus will shift more towards these political events, which could continue to drive CHF dynamics in the near term.

Source:
Crédit Agricole Research/Market Commentary
By Christopher Romano  —  Jun 24 - 07:15 AM
  • AUD/USD hit 0.66265 in Asia then rallied to 0.6656, NY opened near 0.6650

  • Pair traded up +0.14% early NY on the back of broad based US$ weakness

  • AUD/USD rallied slightly despite gains for US Treasury yields US2YT=RR

  • USD/CNH fall to 7.2809, equity ESv1 & goldXAU= gains helped buoy AUD/USD

  • Pair traded near the mid point of 0.6575-0.6715 range in place since May

  • Techs lean bullish; daily RSI rising, consolidation phase persists

  • Dallas Fed manufacturing business index is a second tier data risk in NY

  • Remarks from Fed's Goolsbee, Daly may impact risk sentiment during NY hours

  • Australia May CPI, US weekly claims & May PCE are key risks later this week

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Jeremy Boulton  —  Jun 24 - 05:45 AM
  • EUR/USD sank 1.0916 to 1.0668 after 55-DMA dropped below 200-DMA

  • Now 21-DMA drops below 100-DMA and about to fall below 200-DMA

  • EUR/USD has broken under and holding below daily cloud 1.0778-90

  • Fundamentals are also deteriorating undermining euro nL1N3IM09Z

  • Traders sitting long euros may react paring more of their $5.8bln bet

  • Main target for a drop is 1.0513

Source:
Refinitiv IFR Research/Market Commentary
By Rob Howard  —  Jun 24 - 05:00 AM
  • Cable reaches 1.2665 after pushing its recovery envelope from 1.2622

  • 1.2622 was Friday's five-week low, after UK services PMI miss, US PMI beats

  • Ascent from 1.2622 aided by profit-taking on shorts (1.2619 is 55DMA)

  • Friday's high was 1.2675, after better than expected UK retail sales data

  • 1.2700 is obstacle beyond (1.2695 was low before BoE's dovish hold Thursday)

  • Biden-Trump presidential debate this week. UK election next week (July 4)

Source:
Refinitiv IFR Research/Market Commentary
By Jeremy Boulton  —  Jun 24 - 04:20 AM
  • IFO fell from 89.3 in May to 88.6 in June - was expected 89.7

  • Expectations worsen to 89.0 from 90.4 missing 91.0 f/c

  • Traders are betting that euro rises

  • Net longs reduced in June from $9.2bln to $5.8bln

  • EUR/USD falling 1.0916 to 1.0668 between Jun 4 and Jun 14

  • Weaker IFO follows PMI misses last week longs

Source:
Refinitiv IFR Research/Market Commentary
By Martin Miller  —  Jun 24 - 03:05 AM
  • USD/JPY managed last week to break and register a close above 158.26 Fibo

  • 158.26 Fibo is a 76.4% retrace of the 160.24-151.86 (April-May) EBS fall

  • That increases the scope for much bigger gains well above 2024 160.24 peak

  • 14-day momentum remains positive, reinforcing the overall bullish market

  • We are looking to get long on big dips to 157.20. USD/JPY Trader TGM2336

  • EUR/JPY has seen a 170.68-171.03 EBS range, on Monday, so far

Source:
Refinitiv IFR Research/Market Commentary
By Rob Howard  —  Jun 24 - 02:55 AM
  • Cable has traded a 19 pip range thus far Monday; 1.2633-1.2652

  • 1.2652 is highest level since Friday's five-week low of 1.2622

  • That low was plumbed on June's UK services PMI miss, US PMI beats

  • 1.2622 is three pips shy of 55DMA (stops tipped sub-1.2620, 1.2600)

  • Biden-Trump presidential debate this week. UK election next week (July 4)

  • M&A news: Carlsberg has until July 19 to raise 3.1 billion pound Britvic bid

Source:
Refinitiv IFR Research/Market Commentary
By Martin Miller  —  Jun 24 - 02:25 AM
  • EUR/USD recently failed well ahead of the 1.0763 Fibonacci level

  • 1.0763 Fibo is a 38.2% retrace of the 1.0916 to 1.0668 (June) drop

  • 14-day momentum remains negative, reinforcing the overall bearish bias

  • We are short at 1.0760 for a slump to the 2023 1.0602 (EBS) low

  • However, bears should be mindful of the cloud twist above 1.0780 Wednesday

  • Daily cloud twists usually act like a magnet as they draw closer

  • EUR/USD Trader TGM2334. Previous update nL1N3IJ076

Source:
Refinitiv IFR Research/Market Commentary
By Krishna K  —  Jun 23 - 11:35 PM
  • AUD/USD -0.1% in Asia as weak Asian stock markets, soft commodities weigh

  • ASX 200 -0.75%, Shanghai Comp -1%, Hang Seng -1.2% on weak China sentiment

  • Dalian iron-ore falls 3%, NYK copper hovers near a 8-week low

  • Weak JPY & CNY undermine Aussie; offshore yuan falls to more than 7-mth low

  • But AUD bid on crosses as RBA rate stance diverges from other major c.banks

  • AUD/JPY rallies to 16 1/2-year high on persistent carry demand

  • Australia CPI Wednesday and U.S. price data Friday key for rate expectations

  • Aussie resistance 0.6650-55, 0.6675-80, support 0.6625-30, 0.6600-05

  • Trade a broad 0.6580-0.6710 band; Asia range 0.6641-0.66265

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Krishna K  —  Jun 23 - 09:25 PM
  • EUR/USD on the defensive in Asia after closing 0.1% lower Friday

  • Weighed down by diverging rate stance between Fed and ECB

  • Expectations of ECB rate cuts rise on weaker than expected Europe data

  • Fed likely to remain patient on rates as U.S. economy outperforms

  • Traders brace for first round of France snap election on June 30

  • U.S. core PCE price index, June CPI for France, Italy, Spain key Fri

  • Support 1.0670-75, 1.0650, resistance 1.0720, 1.0750

  • Friday global range 1.0720-1.0671

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Krishna K  —  Jun 23 - 07:45 PM
  • AUD/USD starts the week on a cautious note after closing 0.25% lower Friday

  • Weighed down by broad USD strength and robust U.S. economic data

  • Undermined by weak CNY, JPY and lower commodity prices, particularly metals

  • AUD buoyant on crosses; RBA's rate stance diverges from other major c.banks

  • AUD/JPY rallies to 16 1/2-year high on persistent carry trade demand

  • Hits a 1-year high vs EUR as French politics weigh on single currency

  • Australia CPI Wednesday and U.S. price data Friday key for rate expectations

  • Aussie resistance 0.6675-80, 0.6700, support 0.6630-35, 0.6610-15

  • Trade a broad 0.6580-0.6710 range; Friday range 0.66695-0.66405

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Christopher Romano  —  Jun 21 - 01:35 PM
  • EZ June HCOB PMI was below estimates, US S&P Global PMI was above estimates

  • Diverging data helped EUR/USD trade down on the session & the week

  • German-US spreads US2DE2=RR widened as US PMI rallied yields US10YT=RR

  • US$ gains weighed on EUR/USD as well; USD/CNH rallied toward 7.2920

  • Commodity XAU=, HGv1 losses helped drive investors into the US$

  • EUR/USD traded 1.0678-1.0697 in NY, was down -0.10% late in the session

  • Techs are bearish; RSIs are falling & EUR/USD traded below the 10-DMA

  • US weekly claims & May PCE will be key data risks for next week

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
Jun 21 - 04:55 PM

AUD/USD - Overnight Slide Extended

By Christopher Romano  —  Jun 21 - 01:35 PM
  • NY opened near 0.6655, AUD/USD neared 0.6670 early but sellers emerged

  • Above estimate June S&P Global PMIs drove yields US2YT=RR, US$ upward

  • USD/CNH neared 7.2920 while commodities HGv1, XAU= traded down

  • AUD/USD fell and pierced the 10- & 21-DMAs, 0.66315 traded

  • Light US$ selling lifted AUD/USD above 0.6640, pair was down -0.23% late

  • Techs are mixed; daily RSI falling but pair above 55-DMA, daily cloud top

  • For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
By Paul Spirgel  —  Jun 21 - 01:35 PM
  • GBP$ soft in NorAm afternoon, -0.16% at 1.2636; Friday range 1.2675-1.2622

  • US PMIs abv f/c to keep Fed steady, UK data soft opens path for BoE cuts

  • Sterling's 100-DMA tested, daily cloud top at 1.2596 in focus nL1N3IJ0H2

  • GBP supt melts away, pair bounces ahead of 55-DMA 1.2619; GBP trending lower

  • Below the 55-DMA GBP bears eye daily cloud top at 1.2596, 200-DMA 1.2557

  • Resistance 1.2656 20-DMA, 1.2675 Friday daily high, 1.2715 falling 10-DMA

  • A rise above 10-DMA resistance will see momentum shift away from GBP bears

  • UK elction July 4 increasing in focus; Labour win likely GBP negative

Source:
Refinitiv IFR Research/Market Commentary
By eFXdata  —  Jun 21 - 01:30 PM

Synopsis:

Danske Bank expects the Swiss National Bank (SNB) to refrain from near-term intervention in the foreign exchange market following its recent policy rate cut. The SNB's cautious stance is likely influenced by its revised inflation forecast and the upcoming French elections.

Key Points:

  1. Policy Rate Cut:

    • The SNB cut its policy rate by 25bps to 1.25%, aligning with expectations.
    • The inflation forecast was revised lower, with the SNB noting that without the rate cut, the forecast would have been even lower.
    • The SNB reiterated its commitment to monitor inflation closely and adjust monetary policy as necessary.
  2. FX Intervention Stance:

    • The SNB remains open to intervening in the foreign exchange market if necessary.
    • While SNB President Thomas Jordan indicated no specific preference for intervention direction, Danske believes the bias is towards weakening the CHF.
    • The SNB's cautious approach suggests it will stay sidelined with FX interventions for the time being.
  3. Influence of Risk Sentiment and French Elections:

    • CHF performance is currently tied to overall risk sentiment and the upcoming French elections.
    • EUR/CHF tracked higher following the SNB's rate cut, reflecting market reactions to the central bank's actions and broader risk factors.
  4. Future Policy Rate Expectations:

    • Danske expects the SNB policy rate to end the year at 1.00%.
    • The recent meeting highlighted the frontloaded nature of the SNB's approach but did not significantly alter the long-term policy outlook.

Conclusion:

Danske anticipates the SNB will maintain its current policy rate at 1.25% in the near term, refraining from immediate FX intervention. The SNB's future actions will likely be influenced by broader risk sentiment and the outcome of the French elections. Investors should monitor the upcoming Q1 data on FX intervention, set to be released on 28 June, for further insights into the SNB's potential market activities.

Source:
Danske Research/Market Commentary
By Paul Spirgel  —  Jun 21 - 10:20 AM

GBP/USD fell below 100-DMA support at 1.2640 to a 5-week low at 1.2622 on Friday and is likely to extend these losses as bears target the daily cloud top at 1.2596 and 200-DMA at 1.2558 following soft UK PMI data and dovish BoE rate expectations.

Sterling has fallen from June 12 highs by 1.2860 since after the Fed delivered a hawkish hold, and downside momentum picked up after Thursday's dovishly presented BoE decision to keep rates steady.

The slope of U.S. and UK inflation reduction may highlight upcoming UK-U.S.
rate divergence.

Since September, the downward slope of UK inflation has measured 33 degrees, versus a more modest 12 degrees for U.S. price growth over the same period.

With U.S. inflation and growth relatively strong, the Fed is likely to keep rates high-for-longer.
Market expectations of BoE policy is shifting with some seeing a 5-4 or 6-3 vote at the August MPC, if UK inflation and growth data remains on its current trajectory U.S. and UK rate paths may uncouple adding to GBP weakness.

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary
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