Forex news from the European morning session 1 March
News:
- More from Dudley: Recent market turbulence not due to Fed actions
- US treasury sec Lew says China has assured him there's no need or plans for currency devaluation
- PBOC's Chen says developed countries should consider negative rate impact
- UK's Osborne says Brexit would be a " long, costly and messy divorce"
- More from Abe: Still intends to raise sales tax to 10% as planned
- Japan's Lower House passes record JPY 96.7trln 2016 budget
- Cable finds fresh sellers above 1.4000 but jury still out
- Manufacturing shows the currency excuse is a load of rubbish
- Pound finds itself in 1.40 once again but needs to break 1.4040
- Nikkei 225 closes up +0.37% at 16,085.51
- Option expiries 10am NY cut today 1 March
Data:
- February 2016 UK Markit/CIPS manufacturing PMI 50.8 vs 52.2 exp
- February 2016 Eurozone manufacturing PMI final 51.2 vs 51.0 exp
- January 2016 Eurozone unemployment rate 10.3% vs 10.4% exp
- Germany Markit mftg PMI Feb final 50.5 vs 50.2 exp
- February 2016 German unemployment change -10k vs -10k exp
- France mftg PMI Feb final 50.2 vs 50.3 exp
- Italy unemployment rate Jan flash 11.5% vs 11.4% exp
- Italy Markit mftg PMI Feb 52.2 vs 52.3 exp
- Italy 2015 GDP yy +0.8% vs +0.6% exp
- Switzerland retail sales Jan yy +0.2% vs -1.7% prev
- Spain Markit mftg PMI Feb 54.1 vs 54.5 exp
- Switzerland mftg PMI Feb 51.6 vs 49.6 exp
- Australia commodity price index Feb yy -21.6% vs -24.8% prev
It's been a data-frenzied session but the focus has been on risk sentiment still.
A better showing by Asian equities gave risk-on trades the green light and we saw early rallies in USDJPY and AUDUSD with GBPUSD also seeing some demand into 1.3980 from 1.3945 as EURGBP fell back through 0.7800 to test initial support into 0.7775.
EURUSD has spent the session largely on the back foot into the strong 1.0850 support area with a mixed bag of data not helping to assuage fears of ECB easing next week.
Cable was already on the back foot having run into fresh supply but then was knocked lower to 1.3910 on softer mftg data. There's good demand down there though and with EURGBP continuing on its journey lower toward 0.7750 support we saw a rapid rise to take out 1.3985 offers then 1.4000 triggering a sharp move to 1.4019 before running into the next tranche of supply. We've been down below 1.3775 since but failed to get back above 1.4000 and we remain delicately poised.
USDCHF has remained underpinned but struggles to make too many gains as downward pressure on EURCHF remains for the moment.
The early AUDUSD rally to 0.7193 ran into good supply and we've been back below 0.7150 following the two-way pattern across most pairs with USDCAD
NZDUSD is trawling around 0.6600 waiting for the GDT auction results which are normally out by 14.30 GMT.
More data to come out of the US and this day has a few more twists and turns yet.
