Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close

USDJPY 109.373 | EURUSD 1.11599 | AUDUSD 0.6924 | NZDUSD 0.65411 | USDCAD 1.34946| USDCHF 1.0077 | GBPUSD 1.26522 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.11726 | 1.1162

USDJPY                 109.435 | 109.153           

GBPUSD               1.26628 | 1.26508

USDCHF               1.00727 | 1.00591

AUDUSD              0.69313 | 0.69202

USDCAD               1.34928 | 1.34827

NZDUSD               0.65522 | 0.65416           

EURCHF                1.12519 | 1.12336

EURGBP               0.88269 | 0.88187

EURJPY                 122.210 | 121.927

For Today

  • GBP: Another quiet range with the market opening around the 1.2655 level and rising steadily through to just above the 1.2660 level before dipping back through to the 1.2650 level and reversing to hold quietly through into the grey hour close to the highs, , limited congestion through the 1.2700 level and into the 1.2750 area before some sentimental offers appear, a move towards the 1.2800 will likely see some resistance but a mote through the 1.2820 areas is likely to see some weak stops and the market opening through to weak offers around the 1.2850 level and then stronger offers then appearing on any attempt to the 1.2900 areas. Downside bids light through to the 1.2650 area however, from there congestion is likely to appear in increasing size through to the 1.2600 level with strong stops likely on a push through the figure area to test towards the 1.2550 level and another round of stronger bids.
  • JPY: Very quiet through into the Tokyo session testing into the mid-teens in a quick stab lower and then reversing quickly from the level to push above the 109.40 area, the market drifted from there through to the grey hour in a tight range above the 109.30 level and into 109.40, Downside congestion down through the 109.50 level and increasing as the market moves towards the 109.00 areas, with a break of the 108.80 level likely to trigger weak stops but running into stronger congestion on any dips through to the 108.50 areas and increasing into the 108.00 level. Topside offer into the 110.00 likely to be weak with weak stops possibly opening the market to a quick move through to the 110.50 areas before stronger congestion moves in and increasing into the 111.00 level with strong stops a possibility on a move through.
  • AUD: Quiet range through the day with the market pushing off the early lows around the 0.6920 area an pushing back through the opening levels to lightly test above the 0.6930 and into the grey hour, Topside offers 0.6940-60 areas and likely increasing through the 0.6980-0.7000 levels, downside bids into the 0.6850 area likely to be more sentimental than anything else, stronger bids into the 0.6800 areas with sentimental values likely to show stronger bids on any push lower.
  • EUR: Initially rising from the opening to lightly push above the 1.1170 level the market moved from the level in a slow drift through to the grey hour to hold in the mid 1.1160’s, Downside bids into the 1.1140 level with only a little opening before stronger bids appear through to the 1.1100 areas and likely to continue to the 1.1080 area before weak stops appear and the market opens a little through to the 1.1040 level and better bids reappear for any attempt at the 1.1000 level, topside offers into the 1.1220 area with possibly stronger stops on a push through the level however, above is likely to be congested and any move towards the 1.1300 is likely to be more of a grind through the levels

 

 

Overnight News

CNY:

US shouldn’t underestimate China’s ability to fight – BBG

Weaker Chinese economy needs flexible FX, Yu Yungding former PBoC advisor

USD:

US spares China from currency manipulator label amid trade war – BBG

No major trading partner a currency manipulator – BBG

Italy, Ireland, Singapore, Malaysia, Vietnam now on watch list

EUR:

Salvini girds for first clash with five star after EU vote – BBG

Merkel digs in heels as she sees successor not up to the job – BBG

GBP:

Tory Leadership contest becomes no deal battleground as Esther McVey says it is the only viable option for Brexit – Tel

NZD:

RBNZ: Work required to achieve financial resilience

RBNZ: NZ financial system remains resilient to economic risks

RBNZ: Financial system risks remain elevated

RBNZ: Ongoing effort needed to bolster system soundness

RBNZ: Any further LVR easing subject to subdued credit growth

RBNZ: Current LVR settings remain appropriate for now

RBNZ: Expects to review LVR restriction every six months

NZIER sees RBNZ interest rates again in Sep – BBG

NZ Budget in disarray as hackers raid treasury systems – BBG

JPY:

Abe flirts with early election ahead of Japan sales tax increase – BBG

 

Today’s Data

Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC

NZD       RBNZ Financial Stability Report                                                 

GBP       BRC Shop Price Index Y/Y May A 0.80% | P 0.40%

NZD       ANZ Business Confidence May A -32.0 | -37.5

06:45     EUR        French GDP Q/Q Q1 (F) C 0.30% | P 0.30%

07:00     CHF        KOF Economic Barometer May C 96.2 | P 96.2

07:55     EUR        German Unemployment Change (000’s) May C -8K | P -12K

07:55     EUR        German Unemployment Claims Rate May C 4.90% | P 4.90%

08:00     EUR        ECB Financial Stability Review                   

14:00     CAD       BoC Rate Decision C 1.75% | P 1.75%

22:45     NZD       Building Permits M/M Apr P -6.90%

 

Harry Hindsight

 

  • GBP: Opening around the 1.2680 level the market moved quietly into the Tokyo session before dipping away from the highs just above the opening level in a steady slide through to the 1.2670 level and based along the level through into the grey hour, the market ranged quickly between the two levels before early London pushed the market quickly through to the 1.2700 level with poor Euro numbers as EURGBP moved into an illiquid topside for Cable however, once absorbed the market dropped quickly back to the lows held for a short period before breaking through to the 1.2650’s and based in a wider range from there through into the NYK session trading the 1.2655-80 levels for the most part, NYK were early buyers and pushed through to the 1.2690 level in steady trading before falling back into the 60-80 range for the run to the close, late selling set the low for the day but was unable to push through to the 1.2650 level holding just above through to the close.
  • JPY: Very quiet through the Asian session with early highs seen early in the Tokyo session pushing just above the 109.60 level before drifting back through to the 109.50 opening levels for the move into the grey hour, London were slow sellers through the opening couple of hours testing through to just above the 109.20 area and then spending several hours slowly recovering on a steady push through to the highs of the day and holding the opening level through too late in the session with Sydney opening and selling the market back to hold in the mid 109.30’s.
  • AUD: Slowly rising from the opening just below the 0.6920 areas and pushing into the Tokyo session testing through the 0.6925 level and ranging for several hours in the 0.6920-25 areas before pushing through to the grey hour testing the 0.6930 level, London moved in and the market was pushing back to the opening level in light selling and ranged in a tight pattern through to the NYK session, the market lifted on light buying and steadily extended the highs through the 0.6935 area before running out of steam and drifting to the close holding above the opening levels.
  • EUR: Quiet opening leading through into early Tokyo before dipping away from the 1.1195 level to test steadily into the 1.1180 area and holding through to the grey hour, early numbers saw some gyration however, for the most part the market while choppy was limited and eventually found some strong buying on a move through to make the highs of the day testing towards the 1.1200 level before ranging through to NYK around the 1.1190 level, trade war concerns topped the current economic news, the market quickly dipped through to the 1.1170 level and after a false rally into the London close dipped through into the 1.1160 levels and held in a tight range through to the close.

 

Yesterday’s Premiership results

JPY         Corporate Service Price Y/Y Apr A 0.90% | C 1.10% | P 1.10%       

CHF        GDP Q/Q Q1 A 0.60% | C 0.40% | P 0.20% | R 0.30%

EUR        German Import Price Index M/M Apr A 0.30% | C 0.50% | P 0.00%            

EUR        German GfK Consumer Confidence Jun A 10.1 | C 10.4 | P 10.4 | R 10.2

EUR        Eurozone M3 Money Supply Y/Y Apr A 4.70% | C 4.40% | P 4.50%             

GBP       BBA Loans for House Purchase Apr A 42989 | C 39450 | P 39980 | R 40564

EUR        Eurozone Business Climate Indicator May A 0.3 | C 0.4 | P 0.42   

EUR        Eurozone Economic Confidence May A 105.1 | C 103.9 | P 104 | R 103.9

EUR        Eurozone Industrial Confidence May A -2.9 | C -4.2 | P -4.1 | R -4.3

EUR        Eurozone Services Confidence May A 12.2 | C 11 | P 11.5 | R 11.8

EUR        Eurozone Consumer Confidence May (F) A -6.5 | C -6.5 | P -6.5 | R -7.3

USD       House Price Index M/M Mar A 0.10% | C 0.20% | P 0.30% | R 0.40%

USD       S&P/Case-Shiller Composite-20 Y/Y Mar A 2.70% | C 2.55% | P 3.00%      

USD       Consumer Confidence Index May A 134.1 | C 130 | P 129.2

 

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