Forex news from the European trading session - 30 September 2021
Headlines:
- Dollar technicals continue to shine with month-end, quarter-end in focus
- ECB's Centeno: Inflation spike still regarded as temporary
- Saxony September CPI +4.1% vs +4.0% y/y prior
- Evergrande has made 10% repayment for its wealth management products due this month
- Germany September unemployment change -30.0k vs -33.0k expected
- BOJ's Kuroda: BOJ will not hesitate to ease policy further if necessary
- France September preliminary HICP +2.7% vs +2.8% y/y expected
- UK September Nationwide house prices +0.1% vs +0.6% m/m expected
- UK Q2 final GDP +5.5% vs +4.8% q/q prelim
Markets:
- AUD leads, EUR lags on the day
- European equities higher; S&P 500 futures up 0.4%
- US 10-year yields flat at 1.524%
- Gold down 0.1% to $1,725.46
- WTI down 0.8% to $74.07
- Bitcoin up 3.5% to $42,988
The European session observed some light pushing and pulling as the focus today rests on month-end and quarter-end trading, with US traders set to come into the fray and work through all of that as September draws towards a close.
The dollar is trading mixed but is in a good spot technically, seen losing a bit of ground against commodity currencies as equities are keeping firmer so far.
The bond market is less enthused once again, like yesterday, but we'll see if there will be an extension to the dollar gains from Wednesday - as suggested by Citi's month-end rebalancing model (more on that here).
EUR/USD continues to remain pressured, holding at 1.1570-80 levels - its lowest since July last year as the downside momentum stays the course.
USD/JPY is keeping buoyant, contesting the 112.00 level as buyers eye a firm break above the figure level while GBP/USD is keeping a slight advance after having moved off lows of 1.3416 to hold around 1.3440 levels at the moment.
Meanwhile, AUD/USD is up a touch to 0.7195 but has seen gains ease from 0.7215 earlier. And USD/CAD is down a little to 1.2730-40 levels but off the high of 1.2757 earlier.
The slight easing in risk gains comes as US futures also pull back a little with S&P 500 futures now seen up just 0.4% after having advanced by as much as 0.9% earlier.
It's all about month-end and quarter-end in the session ahead but looking past that, the technicals will have more of a say for dollar pairs in general. Adding to that will be the continued focus on energy prices and bond yields.
Natural gas is up another 4% today as the upside pressure holds.
