- Hungary EconMin: There are worrying signs over Hungary budget, but “it is blatant” that Hungary is not Greece
- Shanghai stock index ends down 1.6% at a more than 13-month closing low
- Russia C.Bank: Some reserves invested in Spanish bonds, sees chances of default as close to zero
- Euro zone sentix index rises to -4.1 in June from -6.4 in May, demonstrably better than median forecast of -7
- ECB’s Costa: It is urgent to show debt path is sustainable in Portugal. Portugal’s banking system is solid
- UK’s Cameron: Coalition will announce spending review framework on Tuesday. Failing to act on deficit may lead to higher interest rates, slide into economic decline
- German April manufacturing orders +2.8% m/m, much better than median forecast of +0.2%. EconMin says recovery in German industry is continuing and firming
EUR/USD has traded higher, helped by European stocks gradually recovering after opening appreciably lower. A couple of decent euro zone data releases (euro zone sentix investor confidence/German manufacturing orders, see above) have helped matters.
EUR/USD rallied early from around 1.1905 helped by Middle Eastern buying, but intially ran into decent US hedge fund selling around 1.1950. This forced the pairing to retreat lower but not for long. BIS came in buying around 1.1925 and that helped provide support.
Eventually sell orders at 1.1955/65 were taken out, helped in no small part by aggressive buying of the EUR/GBP cross by a US bank. We got as high as 1.1991 where well-noted sell orders at 1.1990/00 (including more hedge fund interest) helped cap the advance. We’re presently back at 1.1970.
USD/JPY rallied this morning as the yen gave up ground across the board, risk sentiment showing a semblence of recovery after Friday’s extreme negativity. USD/JPY is up at 91.90 from early 91.25, while EUR/JPY is up at 110.05 from an early 108.60.
Cable has made the most of the slight improvement in general risk sentiment, up at 1.4495 from early 1.4430. EUR/GBP at .8260 is little changed on the day, having run into renewed selling interest when aforementioned buying from US bank got it up as high as .8300.