Forex news from the European trading session - 6 April 2021
Headlines:
- EMA says there is link between AstraZeneca vaccine and blood clots, though cause remains unclear
- EU reportedly may hit vaccination target by the end of June, much earlier than projected
- Eurozone April Sentix investor confidence 13.1 vs 6.7 expected
- UK vaccines minister says Moderna vaccine to be deployed in third week of April
- RBA leaves cash rate unchanged at 0.10% in April monetary policy decision
- New Zealand says to open travel corridor with Australia starting on 19 April
- Germany reports 6,885 new coronavirus cases, 90 deaths in latest update today
Markets:
- USD leads, NZD lags on the day
- European equities higher; E-minis down 0.2%
- US 10-year yields down 1.1 bps to 1.69%
- Gold up 0.4% to $1,735.40
- WTI up 1.5% to $59.58
- Bitcoin down 0.5% to $58,464
Europe extends from the Easter break with a more cheerful mood, playing catch up to the gains in US equities yesterday. However, the overall risk mood was more mixed as US futures kept marginally lower and pulling back from the record highs seen overnight.
Treasury yields also moved off earlier lows in Asia, with 10-year yields moving up from 1.677% to linger around 1.70% in European morning trade.
In FX, the dollar reversed losses from yesterday for the most part with the aussie, kiwi and pound suffering the most as key near-term levels are being challenged.
AUD/USD slipped from 0.7650 to 0.7606 before seeing a slight bounce upon testing the confluence of its key hourly moving averages on the session. The RBA kept policy unchanged so that was a bit of a snoozer at the tail-end of Asia Pacific trading.
The pound is a notable laggard as cable fell from 1.3900 to 1.3822 and is flirting with a potential drop below its 100-hour moving average @ 1.3830 currently.
USD/JPY also saw a slight advance from 110.20 to 110.55 with gains stalling at its 100-hour moving average and settling just below that around 110.40 levels now.
The euro was more resilient as it stuck around 1.1800-20 against the dollar throughout, with large expiries seen over the next few days close to the figure level to consider.
Elsewhere, oil saw a minor rebound after the slump yesterday as it briefly moved up above $60 before holding over 1% gains now around $59.50 levels.
In short, there is still some element of push and pull in the market - bonds in particular - as we digest the latest moves and reactions to the stellar US data since Friday.