Forex news from the European morning session - 4 June 2020
Headlines:
- BOE's Hauser: Negative rates won't happen in the near-term
- BOE's Hauser: Coronavirus outbreak may put markets under strain again
- Hong Kong legislature passes China national anthem bill
- Eurozone April retail sales -11.7% vs -15.0% m/m expected
- OPEC+ meeting said to be still possible this week if members pledge to improve compliance
- UK May construction PMI 28.9 vs 29.4 expected
- China says that it has complained to the US about ban on Chinese airlines flights
- Germany's ambassador to the EU says the bloc assumes UK won't seek Brexit extension
- China further refutes claims that it has halted soybean purchases from the US
- Switzerland May CPI -1.3% vs -1.3% y/y expected
- Austria reportedly may open borders with Italy on a regional basis from 15 June
- BOJ has no plans to buy municipal bonds for now
Markets:
- CHF leads, AUD lags on the day
- European equities lower; E-minis down 0.6%
- US 10-year yields flat at 0.743%
- Gold up 0.7% to $1,712
- WTI down 1.5% to $36.70
- Bitcoin down 0.4% to $9,548
For once, stocks are not rallying to start the day. I know, it happens though.
It seems that the market is taking a bit of a breather after the unrelenting move higher since last week, as European equities are keeping lower alongside US futures.
In turn, this is helping to see the dollar pull back some of its losses in trading this week.
EUR/USD is down slightly to 1.1200 but the focus in the pair now turns to the ECB meeting, due in a little over a half-hour from now.
Meanwhile, cable also eased from 1.2550 to 1.2500 before bouncing back a little with Brexit headlines not too supportive in the European morning.
The aussie kept around 0.6885-05 levels against the dolar for the most part, not really doing a whole lot amid the more tepid risk mood in the market today.
All eyes in the market now turns towards the ECB policy decision at 1145 GMT. The central bank is expected to add to stimulus measures by expanding its PEPP size - and possibly duration - so let's see if they will deliver on that front later.
Given the slightly softer risk mood, any disappointment could see the pullback today grow deeper ahead of North American trading.
