Daily FX Market Commentary

Andy Harrison

Good morning,

Asian opening and NYK Close

USDJPY 78.10/15  (closed  78.07) | EURUSD 1.2405/10 (closed 1.2425) | EURJPY 97.00/05  (closed  97.05) | AUDUSD 0.9670/80  (closed 0.9686) | NZDUSD 0.7525/35  (closed  0.7549) | USDCAD 1.0415/20  (closed  1.0417) | EURCHF 1.2012/17  (closed 1.2014)| USDCHF 0.9663/68  (closed 0.9668)| GBPUSD 1.5353/63  (closed  1.5364) | EURGBP 0.8091/96  (closed  0.8095) |

Weekend News

EUR:

Merkel Presses Spain to Accept Bailout, Spiegel Reports
Merkel Rejects Debt Sharing as Obama Urges End to Crisis Cloud
Schaeuble Says Germany to fore fill  Fiscal Pact in 2013, FAZ Says
Rajoy Urges Euro Members to Cede Budget Control to New Group
EU Said to Prepare Start of Permanent Bailout Fund for July 9
German States Oppose Swiss Tax Accord Terms, Sueddeutsche Says
Bundesbank Tells FAZ Too Early to Set Up EU-Wide ‘Banking Union’
Euro Bonds Will Be Sold in Some Form, Monti Tells To Vima
Portugal Says Aid Plan’s Fourth Review Has Been Successful
Greece’s Credit Rating Cap Cut by Moody’s on Euro Exit Risk
CNY:

China’s Non-Manufacturing Growth Slowed in May, PMI Survey Shows
Beijing to Allow Govt-Run Property Agents to Aid Housing Supply
JPY:

Japan’s Noda to Reshuffle Cabinet in Bid for Opposition Backing
AUD:

Australian Unemployment Rate May ‘Tick Up Slightly,’ Swan Says
USD: SEC Approves Exchange Proposal to Adjust U.S. Trading Curbs

Harry Hindsight

·         EUR: Euro’s stayed weak throughout Asia and into the European session with a couple of quick attempts below 1.2300 triggering some stop losses but as it was just prior to NFP numbers in the US on release the market rallied strongly as USD fell across the board, Euro moved quickly above 1.2450 before falling back but finding a base just below 1.2400 and moving steadily up over the remainder of the session to the close.

·         GBP: Falling on the open, one supposes that M&A mentioned in last week’s ramble continues having traded down to the 1.5270 level NFP kicked in and we spiked up to around the 1.5430 level a couple of times before declining to trade around 1.5360 area for the remainder of the session.

·         AUD: From the Asian lows London continued selling pushing it well into the 0.9640’s and NYK came in selling hard taking it through the 0.9600 level triggering stop losses to 0.9580 level just before NFP’s caused the spike higher quickly hitting above 0.9720 before settling into a 0.9680/0.9700 into the close.

·         JPY: Asian market held up trading for the most part 78.40/50, once Europe moved in again safe haven flows pushed the USDJPY down to below 78.20 initially where bids from those beginning to turn long looking for intervention, and/or Gamma trades against option positions. When NFP came out there was a quick dip to below 77.70 however it rallied back the 78.20 just as quick as buyers took advantage before running out for the rest of the day 78.20/78.00

Friday’s premiership results

Actual = A | Consensus = C | Previous = P | Revised = R 

NZD       Terms of Trade Index Q/Q Q1 A -2.30% | C -2.80% | P -1.40%     

JPY         Capital Spending Q/Y Q1 A 3.30% | C 1.00% | P 7.60%     

CNY        PMI Manufacturing May A 50.4 | C 52 | P 53.3   

CNY        HSBC Manufacturing PMI May A 48.4 | P 49.3    

CHF        Retail Sales (Real) Y/Y Apr A 0.10% | C 3.60% | P 4.20% | R 4.70%

CHF        SVME-PMI May A 45.4 | C 47.4 | P 46.9 

EUR        Eurozone PMI Manufacturing May (F) A                45.1 | C 45 | P 45             

GBP       PMI Manufacturing May A 45.9 | C 49.7 | P 50.5 | R 50.2

EUR        Eurozone Unemployment Rate May A 11.00% | C 11.00% | P 10.90% | R                11.00%

CAD       GDP M/M Apr A 0.10% | C 0.30% | P -0.20%       

USD       Personal Spending Apr A 0.30% | C 0.30% | P 0.30%        

USD       Personal Income Apr A 0.20% | C 0.30% | P 0.40%            

USD       PCE Deflator M/M Apr A 0.00% | C 0.10% | P 0.20%         

USD       PCE Core M/M Apr A 0.10% | C 0.20% | P 0.20%

USD       PCE Core Y/Y Apr A 1.80% | C 2.00% | P 2.00%   

USD       Change in Non-farm Payrolls May A 69K | C 150K | P 115K | R 77K

USD       Unemployment Rate May A 8.20% | C 8.10% | P 8.10% 

USD       Construction Spending M/M Apr A 3% | C 0.40% | P 0.10%          

USD       ISM Manufacturing May A 53.5 | C 54 | P 54.8    

USD       ISM Prices Paid May A 47.5 | C 57 | P 61

For today

USDJPY:

Topside 78.50-78.60 (light offers) 78.80-90 (light offers) 79.00-79.20 (light stop bids)

Downside 78.00 (light bids) 77.80-77.70 (light stop offers) 77.60 (med stop offers)

EURUSD:

Topside: 1.2450 (Light stop bids) 1.2480-1.2500 (med offers)

Downside: 1.2380 (light bids) 1.2375-60 (light stop offers) 1.2360-50 (med bids)

AUDUSD

Topside: 0:9720 (med offers) 0.9730-0.9740 (med stop bids)

Downside: 0.9630 (light bids) 0.9600-0.9580 ( light stop offers)

23:50     JPY         Monetary Base Y/Y May               A 2.40% | C 0.20% | P -0.30%    

0:30        AUD       TD Securities Inflation M/M May A 0.00% | P 0.30%        

JPY:

Japan Noda: recent yen gains do not reflect fundamentals

Japan Azumi: No Comment on if Intervened in FX Markets

BOJ Shirakawa: Carefully watching yen rise effect on economy

Japan Noda Reshuffles Cabinet in Bid to Win Opposition Support for Tax Hike

Japan May Monetary Base Marks First On-Year Rise in 3 Months

USD:

Pianalto says jobs report hasn’t changed her outlook – WSJ

KRW:

North Korea Threatens to Attack South Korean Media

CNY:

China Economic Planner Sees 2012 CPI Growth Below 3.4%

China PBOC Governor: Not Necessary Now To Commit To Figure for IMF Fundraising 

CNY/EUR:

China PBOC Governor: Euro Zone Stimulus Moves Only Temporary, Seen Limited

CNY/EUR: China CB chief affirms support for euro zone-paper

AUD: Australia inflation subdued in May -TDMI

Australia job advertisements fall in May -ANZ

Australian Company Profits Fell 4.0% in 1Q Vs. -2.5% Consensus

Australia’s Triple-A Rating at Risk – Report

 

·         EUR: The market moved up on the opening trading up to 1.2440 level before we saw any real selling flowing through from there it was downhill for the next couple of hours trading down through the figure to set the low on the day around the 1.2390 level after that you’d think the bank holidays were in Asia rather than the UK.

·         GBP: 1.5343/1.5374 about calls it, while Euro’s declined in the later part of the session GBP rose above 1.5370 for the second time and held above 1.5360 as EURGBP selling was seen entering the market.

·         AUD: While the markets may be quiet there was no change on the Oz moving from the opening area of 0.9700 and slowly declining to the 0.9630 area and settling into a 0.9640/60 range for the greater part of the session.

·         JPY: A very quiet session ranging from 78.06/78.24 with a brief spike during fixing to 78.50 and it was brief over and done with in 5mins. Short JPY positions are starting to build on the back of continued verbal intervention from the BoJ and Government officials, options strategies are been taken up by those that want to limit the risk but the delta alone is creating some flow.

Today’s data

Consensus = C  Previous = P

8:30        EUR        Eurozone Sentix Investor Confidence Jun C -30 | P -24.5               

9:00        EUR        Eurozone PPI M/M Apr C 0.20% | P 0.50%           

9:00        EUR        Eurozone PPI Y/Y Apr C                 2.70% | P 3.30%               

14:00     USD       Factory Orders Apr C 0.30% | P -1.50%                 

 

Ranges as of 6am London time

                                Highs   Lows

USD/JPY               78.50 |  78.039

EUR/USD             1.2443 | 1.2375

EUR/JPY               97.26 | 96.779

AUD/USD            0.9707 | 0.9627

NZD/USD             0.7552 | 0.7503

USD/CAD             1.0446 | 1.0390

EUR/CHF              1.2014 | 1.201

USD/CHF             0.9696 | 0.96572

GBP/USD             1.5377 | 1.5344

EUR/GBP             0.80915 | 0.8067

 

Good luck 

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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