Forex news from the European trading session - 11 August 2020
Headlines:
- US July NFIB small business optimism index 98.8 vs 100.5 expected
- New Zealand reports first local coronavirus cases in 102 days; virus restrictions return
- Germany August ZEW survey current situation -81.3 vs -69.5 expected
- Russia president Putin says have approved first Russian-produced coronavirus vaccine
- China July M2 money supply +10.7% vs +11.2% y/y expected
- Gold correction deepens in fall below $2,000
- UK July jobless claims change 94.4k vs -28.1k prior
- Hong Kong goods to be labelled 'Made in China' for export to the US after 25 September - report
- Germany reports 966 new coronavirus cases in latest update today
- Partial data from stage 4 coronavirus lockdown Melbourne - spending slumped 17%
Markets:
- CAD leads, JPY lags on the day
- European equities higher; E-minis up 0.6%
- US 10-year yields up 3.2 bps to 0.607%
- Gold down 2.5% to $1,977.55
- WTI up 1.7% to $42.65
- Bitcoin down 0.9% to $11,749
It was a quiet session in terms of key headlines but the market moves have been rather modest so far to kick start the day.
Precious metals are among the big movers, with gold and silver experiencing a deeper pullback to start the week. Gold is down by over 2% in a drop back under $2,000 as the technical exhaustion hits, with silver down by more than 4% back under $28.
The risk mood stayed more buoyant throughout, with European equities rising by more than 2% in general and US futures also looking perky following gains yesterday.
The better risk sentiment is also lifting Treasury yields - 10-year yields back to 0.60% - and that is weighing on the dollar and yen in trading so far today.
EUR/USD moved up from 1.1740-50 to 1.1800 and testing its 200-hour moving average while GBP/USD rose from 1.3070 to above 1.3100 and its own key hourly moving averages.
Commodity currencies stayed bid during the session, with AUD/USD keeping around 0.7170-80 levels and USD/CAD sinking from 1.3330 to session lows of 1.3277.
The market focus is on risk and the correction in precious metals for the time being, as investors will be watching for any stimulus progress in Washington later in the day.