Forex news from the European morning session - 24 June 2020
Headlines:
- Macron and Merkel to meet on 29 June to discuss EU recovery fund proposal
- US MBA mortgage applications w.e. 19 June -8.7% vs +8.0% prior
- US weighs new tariffs on $3.1 billion of exports from the EU and UK
- Ifo economist: We have passed economic trough, economy on upward path now
- Germany June Ifo business climate index 86.2 vs 85.0 expected
- ECB's Lane: PEPP is not open-ended phase of stimulus
- Tokyo reportedly finds 55 new coronavirus cases in latest update today
- Germany reports 587 new coronavirus cases, 19 deaths in latest update
Markets:
- USD leads, NZD lags on the day
- European equities lower; E-minis down 0.9%
- US 10-year yields up 0.3 bps to 0.715%
- Gold up 0.4% to $1,775.60
- WTI down 2.2% to $39.50
- Bitcoin down 3.0% to $9,343
The session began with markets keeping more tepid before a slight tilt towards being risk-off, and the mood was spurred on further by the return of Tariff Man.
The US is looking to impose tariffs against the EU over the Airbus subsidy issue and kept the risk aversion in the market going, with European stocks declining as a result.
Most indices saw losses move to around 2% before sitting near there now while US futures were trading flat at the beginning, but is now seen lower by close to 1%.
In the currencies space, the dollar and yen kept firmer with AUD/USD seen falling from 0.6940 to 0.6900 while NZD/USD kept at losses after the RBNZ jawboned the kiwi earlier in the day, falling from 0.6460 to 0.6420 levels during the session.
The euro and pound also kept weaker but are off earlier lows, with cable falling from 1.2515 to 1.2466 before recouping some ground just back above 1.2500 currently.
Elsewhere, gold kept with the bullish breakout as the push higher continues. Gains extended close to $1,780 before hovering just under there at the moment.
Looking ahead, risk remains the key spot to watch and it looks like US stocks are still very much bound to the key technical levels stemming from last week.
In that lieu, be mindful of the risk-off sentiment today with US coronavirus figures once again a key spot to watch. Virus fears don't matter until it matters, so just be wary of that.
