USD and commod currencies open better
Hi all , I may hope you all had a pleasant, sunny, relaxing and peaceful weekend. Here we are ready for another week in your company.
Risk gets the small expected lift as NK vows not do any other missile tests and closes one (of three) nuclear development sites in preparation of Internal (peace?) talks.The market buys it to a small extend for now buts isn’t fooled. Everybody knows historically how far NK promises have gone as soon as some cash came back into the country after sanctions had been sweetened. EUR takes the same direction as JPY as Deutsche bank woes, Italian election ongoing uncertainties and weaker data keep the pressure on. Commod currencies are a bit on the mend, helped by JPY cross demand, Mnuchin plans to visit China to ease tensions and China’s CB Yi confirming the Chinese economy is under control.
G7 foreign ministers meet in Toronto from today, expect a few comments from them especially re Russia, Middle East but don’t expect any real game changers for us FX followers.
Macron’s visit to the US tomorrow an Merkel’s end of the week should produce the usual head lines re trade worries.
In the meantime has Uk Chancellor Hammond started his look at for a BOR Carneys replacement a bit earlier than anticipated . The FT has put together an interesting list of possible successors.
Monday will kick off the data calendar with PMI’s across the globe. Tuesday morning AUD CPI will take the lead as the rest of the world will see business indicators hit the wires.
And this week will see a slew of earnings from both sides of the Pont, not least the awaited US Tech sector and the European continent banking sector, Deutsche again.
There’s more but to close the week we’ll have BOJ’s monetary policy, result on Friday. Nothing is expected but still, what we have been seeing on de facto less JGB buying as there are less to buy, may be part of a plan to scale back on the non-fixed money injections. Nikkei has this on the ETF buying frequency for April for instance.
I trust we will be yield and stock watching again, the USD having done a pretty good job end of the week and showing pretty reasonable intentions to give it another go.
I’m in the opportunist jobbers camp for now, preferring to buy USD dips and sell EUR rallies.
USDJPY could test the 108 offers, EURJPY seems now trapped between 132.00/20 supports and 133 feeling a bridge to far.
1.2300 and 1.2330 will be hurdles for the EURUSD as where a break under 1.2240 would look pretty bad on its CV imo.
It’s early in the trading week, illiquid and rapidly changing, so stay safe and happy hunting if you’re already on the tracks