Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 102.55 | EURUSD 1.11384 | AUDUSD 0.74983 | NZDUSD 0.71726 | USDCAD 1.2911 | USDCHF 0.9731 | GBPUSD 1.32769 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.11444 | 1.11249

USDJPY                 102.805 | 102.420

GBPUSD               1.33090 | 1.32524

USDCHF               0.97573 | 0.97289

AUDUSD              0.75046 | 0.74485

USDCAD               1.29223 | 1.28868

NZDUSD               0.71924 | 0.71593

EURCHF                1.08514 | 1.08374

EURGBP               0.83980 | 0.83714

EURJPY                 114.510 | 114.005

For today

• EUR: A very quiet day through the session with the lack of a US market, opening around the 1.1140 areas and drifting just through the 1.1130 levels and then eventually rising back through the 1.1140 levels late in the session. Topside offers into the 1.1180 areas likely to continue through the 1.1200 areas with possible weak stops through the 1.1220 areas with stronger offers likely to appear through the 1.1250 areas and likely to slow any ascent through to the 1.1300 on what may be a quiet session, Downside bids into the 1.1100 areas are likely to be light with those bids likely to disappear on the move through the to the stronger 1.1000 areas.
• GBP: Opening around the 1.3260 areas and quickly gapping higher to the closing areas from Friday before gradually moving through to the 1.3290 areas and holding there for a good period of time before eventually sneaking through the 1.3300 levels before holding quietly around the 1.3290 levels through into the London session, Topside offers into the 1.3350 levels are likely to be reasonably strong for the moment with the market quickly opening to the 1.3600 areas and possibly limited liquidity through the areas, downside bids likely to be weak through to the 1.3200 areas before the market opens further to test the stronger bids into the 1.3150 areas.
• JPY: USDJPY saw some limited buying with the market opening slightly higher around the 102.65 areas before slipping into the Tokyo session testing to the 102.40 areas in a steady shift with JPY buying as uncertainty builds in Europe and China, the market moved off the bottom levels to gradually push back to the 102.80 areas before stalling and holding in a tight range.
• AUD: Talk of the Turnbull majority ebbing away while the PM is quietly confident on another term for the Government, saw the Oz opening lower around the 0.7450 areas and then gradually moving through into the Tokyo session rising and filling the gap on the charts to again test through the 75 cent levels before drifting after the push to hold in the 0.7485 levels with nothing left to do but wait for the facts rather than the rumours, the market heads into the London session holding the 0.7480 areas, with Topside offers through the 75 cent levels and likely to see those offers continuing through to the 0.7550 areas before further vulnerability appears and the 76 cent levels and beyond open up. Downside bids light through to the 0.7410 areas and the market starts to see some congestion a break through the area though is likely to see weak stops and a quick move to the stronger 0.7350 areas.

Overnight News                                                                  

AUD:

Moody’s: Short-Term Aussie Vote Uncertainty Has Limited Impact

Fitch: Close Australia Vote Could Mean Different Fiscal Outlook

S&P Could Cut Australia’s AAA Rating If Budget Fails to Improve

Australia May Building Approvals Fell 5.2% M/M; Est 3.5% Drop

Australia June Melbourne Inst. Inflation Gauge Rises 0.6% M/m

Australia ANZ June Job Advertisements Rise 0.5% M/m

JPY:

Japan’s Abe Should Rethink Economic Policies, 55% Say Asahi Poll

Abe’s Cabinet Approval Rating Falls to 45.8%: Sankei/FNN Poll

BOJ tankan: Japan firms expect CPI to rise 0.7 pct a year from now

BOJ May Cut CPI Outlook for This Fiscal Year: Yomiuri (Sat.)

NZD:

NZ Treasury Says Brexit Likely to Have Limited Economic Impact

NZ Housing Infrastructure Fund May Initially Own Assets: Key

Today’s data

Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT

JPY         Monetary Base Y/Y Jun A 25.40% | C 26.30% | P 25.50%

AUD       TD Securities Inflation M/M Jun A 0.60% | P -0.20%

AUD       Building Approvals M/M May A -5.20% | C -3.60% | P 3.00%

08:30     GBP       Construction PMI Jun C 50.6 | P 51.2

08:30     EUR        Eurozone Sentix Investor Confidence Jul C 8.1 | P 9.9

09:00     EUR        Eurozone PPI M/M May P -0.30%

09:00     EUR        Eurozone PPI Y/Y May P -4.40%

Weekend News

AUD:

Turnbull Says Quietly Confident of Securing Majority Government
Australian Industry Faces ‘Testing Times’ on Inconclusive Vote
Australia Election is ‘Worst Possible Outcome’: Business Group
Shorten Says Aussie Vote Result May Not Be Known for Days
Australia Business Council Seeks Roadmap After Unclear Election
GBP:

May Cements Lead as Tory Race for New U.K. Premier Takes Shape
JPY:

Japan Needs Permanent Finance to Cover Tax Rise Delay: Tanigaki
Japan’s Abe Cancels Speech as Hostages Taken in Bangladesh: NHK
Abe Says Bangladesh Attack ‘Inexcusable Act of Terrorism’: NHK
EUR:

Greece Mulls Exempting ‘New Money’ From Cap Controls: Stournaras
Greece Could Tap Bond Markets in 2017, Regling Tells Kathimerini
EUR/CNY:

Greece to Apply to Be Member of AIIB, State-Run ANA Reports
USD:

Clinton Says Knows of No Timeline to Wrap Up FBI E-Mail Inquiry
NZD:

N.Z. Announces NZ$1b Housing Infrastructure Fund: NZ Herald
CNY:

China to Hold Military Exercises in South China Sea from July 5
TRY:

Erdogan Says Turkey Will Offer Citizenship to Syrians: HT
Turkey June Preliminary Trade Gap $6.4b: Customs Data
RUB/TRY:

Russian Govt. to Discuss Normalization of Trade with Turkey

Harry Hindsight

• EUR: A quiet range through the day saw the Euro moving off the 1.1100 areas initially testing to the 1.1120 areas before slipping back late into the Asian session drifting through into the London session testing to the 1.1070 areas before London started to buy with PMI coming in stronger than expected and the market again pushed towards the highs, the market held through towards the NYK session were the market started to slowly rise higher testing through to the 1.1170 areas before USD buying moved into the late session with the market pushing back to the 1.1120 levels with ISM numbers showing a mixed result and the market then ranged from the 1.1120-50 areas to finish in the middle of that range to the close.
• GBP: A choppy day throughout, with the market dipping initially from the 1.3340 areas and quickly to the 1.3280 level before the Tokyo opening, which saw the market rising quickly back to test the 1.3350 areas holding through the Tokyo session around the level until the early European market started to move in and a steady sell off through to the 1.3270 areas, from there the market bounced around with no particular conviction testing towards the highs and falling back to the 1.3250 areas repeatedly throughout the day before holding a narrow range into the last few hours before holding around the 1.3270-80 areas to the close.
• JPY: USDJPY drifted lower through the Asian session with broadly better Tankan numbers falling back from the 103.30 high levels it drifted to the 102.80 levels into the London session, London were sellers from the opening and the market tested back through to the 102.50 areas before finding support and the market then held quietly through the day basing from that area and unable to push through the 102.70 levels before finishing just around the 102.55 levels.
• AUD: As USDJPY drifted lower through the session so the AUDUSD started to rise with the market moving through the 0.7450 areas to test gradually through to the London session only slightly above the opening and then quickly testing to the 0.7490 areas, the move into the NYK session saw further limited buying and the market tested the 0.7500 areas once before drifting off for a while before finishing the day just off those highs.

Friday’s premiership results

Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT

JPY         Unemployment Rate May A 3.20% | C 3.20% | P 3.20%

JPY         Household Spending Y/Y May A -1.10% | C -0.90% | P -0.40%

JPY         National CPI Core Y/Y May A -0.40% | C -0.40% | P -0.30%

JPY         Tokyo CPI Core Y/Y Jun A -0.50% | C -0.50% | P -0.50%

JPY         Tankan Large Manufacturers Index Q2 A 6 | C 4 | P 6

JPY         Tankan Large Manufacturers Outlook Q2 A 6 | C 3 | P 3

JPY         Tankan Non-Manufacturing Index Q2 A 19 | C 19 | P 22

JPY         Tankan Non-Manufacturing Outlook Q2 A 17 | C 17 | P 17

JPY         Tankan Large All Industry Capex Q2 A 6.20% | C 5.60% | P -0.90%

JPY         Tankan Small Mfg. Index Q2 A -5 | C -6 | P -4

JPY         Tankan Small Mfg. Outlook Q2 A -7 | C -7 | P -6

JPY         Tankan Small Non-Mfg. Index Q2 A 0 | C 1 | P 4

JPY         Tankan Small Non-Mfg. Outlook Q2 A -4 | C -2 | P -3

CNY        Manufacturing PMI Jun A 50 | C 50.1 | P 50.1

CNY        Non-manufacturing PMI Jun A 53.7 | P 53.1

CNY        Caixin China PMI Mfg. Jun A 48.6 | C 49.2 | P 49.2

JPY        Consumer Confidence Index Jun A 41.8 | C 41.1 | P 40.9

CHF        Retail Sales (Real) Y/Y May A -1.60% | C -1.70% | P -1.90% | R -2.20%

CHF       SVME PMI Jun A 51.6 | C 54.9 | P 55.8

EUR        Eurozone Manufacturing PMI Jun (F) A 52.8 | C 52.6 | P 52.6

GBP       PMI Manufacturing Jun A 52.1 | C 50.2 | P 50.1 | R 50.4

EUR        Eurozone Unemployment Rate May A 10.10% | C 10.10% | P 10.20%

USD       ISM Manufacturing Jun A 53.2 | C 51 | P 51.3

USD       ISM Prices Paid Jun A 60.5 | C 63.9 | P 63.5

USD       Construction Spending M/M May A -0.80% | C 0.70% | P -1.80%

Stay lucky

Andy

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