Forex news from the European trading session - 24 April 2018
Economic data:
- UK April CBI trends total orders 4 vs 4 expected
- UK March public sector net borrowing -£0.3 bn vs +£1.3 bn expected
- Germany April Ifo business climate index 102.1 vs 102.8 expected
- Italy April consumer confidence 117.1 vs 116.9 expected
- France April business confidence 108 vs 108 expected
- Japan March final machine tool orders y/y +28.1% vs +28.1% prelim
- Switzerland March trade balance CHF 1.77 bn vs CHF 3.14 bn prior
- Japan February final leading indicator index 106.0 vs 105.8 prelim
Government/Central banks:
- Kremlin remains 'rather cautious' on hopes that US may ease sanctions on Rusal
- ECB's Villeroy: There is a need for internationally-harmonised answers on cryptocurrencies
- PBOC official is said to expect more RRR cuts - report
- ECB's Villeroy says diluting financial regulation paves the way for next financial crisis
- Ifo economist sees German Q1 growth at 0.4% vs 0.6% in Q4
- Japan says trade talks with US not going to start until June
- Iran president warns Trump against leaving nuclear deal
Markets:
- CAD leads barely, NZD lags on the day
- European equities mixed, but DAX and Eurostoxx with gains
- Gold up by 0.08% to $1,325.90
- WTI up by 0.66% to $69.09
- US 10-year yields flat at 2.972%
- Bitcoin up by 4.2% to $9,305
There wasn't any broad directional move in European trading today as US 10-year yields traded between 2.96% to 2.97% for the most part, failing to provide the kind of enthusiasm that has helped give the dollar a lift in previous sessions.
The dollar did try to test the waters at the start of the session, but eventually it all fiddled and now we're back to square one again in the market. The changes among the major currencies below highlights what a narrow day it has been:
EUR/USD continues to hug the 100-day MA level @ 1.2210 with any downside move currently kept in check by large option expiries at the 1.2200 today and also on Thursday. If the dollar's upside is facing a pause, the pair looks set to move only when the ECB meets on Thursday.
USD/JPY meanwhile didn't do much in trading today. The pair was lower at the end of the Asian session, and then kept within a range of 108.70 to 108.90 throughout European trading - basically mirroring the subdued range in US yields.
GBP/USD was one of the more active pairs on the session, hitting a low of 1.3918 early on as the dollar gained some momentum before reversing to hit a high of 1.3961 before eventually settling in the current range of 1.3940 to 1.3950 levels.
USD/CAD has been one of the more quiet pairs with the loonie not really subject to weakness against the dollar early on in the session. But that's not to say that it pulled away on the day or anything either. The pair continues to stay between a tight range of 1.2830 to 1.2840 on the day.
It's a similar story to the aussie as AUD/USD trades just above the 0.7600 figure level for the most part today with highs contained around 0.7615. The kiwi is a different story though. After leading losses in the Asian session, it pretty much just stuck to the bottom with NZD/USD falling to a low of 0.7106 earlier before finding a range of 0.7110 to 0.7130 for the most part in trading.
The market isn't really prepared for a dollar correction just yet despite the rise over the last week. And that indicates that this is more of a pause in anticipation for the next move if anything else. At the moment, yields are not providing the catalyst to jump start the dollar today so let's see if the market is patient enough to wait it out or if positions are starting to be cleared ahead of the ECB and BOJ meetings later this week.
