Forex news from the European trading session - 12 August 2020
Headlines:
- US MBA mortgage applications w.e. 7 August +6.8% vs -5.1% prior
- Precious metals rebound, risk fares better on the session
- China reaffirms that US' TikTok ban has nothing to do with national security
- China to bring up WeChat, TikTok issues in upcoming trade talks with the US - report
- UK's Sunak: There will be many more job losses in the coming months
- UK June monthly GDP +8.7% vs +8.0% m/m expected
- UK Q2 preliminary GDP -20.4% vs -20.7% q/q expected
- German health minister says 'very skeptical' about Russian coronavirus vaccine
- NZ PM Ardern: Cabinet to make decision on restrictions on Friday
- NZ health chief says that there are four more probable coronavirus cases
- NZ investigating the new COVID-19 cases were imported by freight
Markets:
- CHF leads, NZD lags on the day
- European equities a little higher; E-minis up 0.7%
- US 10-year yields up 2.6 bps to 0.668%
- Gold up 1.1% to $1,932.35
- WTI up 1.5% to $42.22
- Bitcoin up 2.4% to $11,475
There weren't much notable headlines on the session as the market focus stays on the same few themes on the week so far.
Precious metals observed a turnaround though as gold rebounded after nearing a key trendline support in a move back above $1,900. The low for the day touched $1,863 in Asian trading before rising to a high of $1,949 - now settling around $1,930 levels.
Meanwhile, silver rose by over 5% bouncing off a low of $23.45 to a high of $26.28 before settling around $25.40-60 levels currently.
The risk mood also improved throughout the session with European equities nudging higher after a softer open. US futures also gradually pushed higher during the session, with S&P 500 futures seen up by ~0.7% at the moment.
Put together, the moves saw the dollar weaken with EUR/USD rising from 1.1720 to 1.1779 while GBP/USD pushed from 1.3030 to 1.3068 before easing to 1.3010-20 now.
AUD/USD is still weaker at around 0.7125, hovering between 0.7120-40 during the session, while the kiwi is keeping weaker after the RBNZ expanded QE and flirted with the idea of introducing negative rates down the road.
Elsewhere, Treasury yields are still doing its own thing this week as they push higher to near 0.67% and that is underpinning yen pairs in general. USD/JPY is on the advance, moving to near three-week highs close to 107.00 currently.
It feels like there are a few key moving parts in the market right now so there is plenty to keep track of, not forgetting US stimulus talks as well.
