FX News Today
European Fixed Income Outlook: 10-year Bund yields moved higher at the open but have already fallen back slightly to currently 0.352%, while 10-year Treasury yields and 10-year JGB yields are up 0.7 bp and 0.5 bp respectively. Stock market sentiment remained upbeat in Asia and UK Futures moved higher with US Futures overnight, underpinned by a weaker Pound. Trump continues to ruffle feathers in Europe saying that he told UK PM May that her Brexit proposal could “kill” any future US trade deal, while suggesting that Boris Johnson, who stepped down as foreign secretary over May’s “soft Brexit” plans, would make a good PM. Backing then for the hard line Brexiteers in the UK who many speculate are setting out to oust May. European Stock Futures are still moving higher for now, but is looks increasingly likely that a hard Brexit would hit not just the UK economy. Today’s calendar includes BoE’s Cunliffe, due to speak at 11:30 GMT.
FX Update: USDJPY rallied to a fresh 6-month high, of 112.77, as most Global Stock markets continued to rally, buoyed by a strong global economy and expectations for a solid Q2 corporate earnings reporting season. Chinese markets still underperformed, however, along with the Australian share market, on concerns about worsening Sino-US trade relations. The weakness in the Yen in turn drove an outperformance in Japanese Stock markets. Outside the case for USDJPY, the Dollar itself has been mixed. EURUSD has drifted towards 1.1650 and yesterday’s 1-week low at 1.1649, and Cable edged out a 10-day low of 1.3162, while the Dollar lost a little ground to the Australian Dollar and other Dollar bloc units.
Charts of the Day
Main Macro Events Today
- MPC Member Cunliffe Speech
- Prelim UoM Consumer Sentiment – Expectations – a small move up to 98.5 in early-July from 98.2 in June.
- FOMC Member Bostic Speech
- Fed Monetary Policy Report
Support and Resistance level
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Andria Pichidi
Market Analyst
HotForex
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