Danske Research discusses the current market conditions across G10 FX.
"Looking across DM FX and across asset classes, markets are in a stalemate. In the key crosses such as SEK, NOK, GBP and USD (all versus EUR), as well as AUD/USD all seem contained within recent ranges. We think this may continue in the next few weeks as incoming data is well in line with the consensus narrative of recovery and inflation," Danske notes.
"Shifting the narrative will likely require moving expectations to tightening of People's Bank of China and the Fed by a few quarters. US payrolls and Chinese CPI are the two prime sources of tail risk for such," Danske adds.