Forex news and economic trading headlines 16 August 2016
News:
- USDJPY tests the water under 100.00
- Here comes the Japanese jawboning - Financial authorities are watching FX closely
- China's SAFE says Brexit and seasonal factors increased demand for FX in July
- GBPUSD yet to breach 1.3000 after stronger than expected UK inflation data
- Pound jumps on Brexit induced inflation
- Heads-up for NZD traders: It's GDT auction time again today plus large AUDNZD expiries playing out
- Germany faces higher unemployment due to refugee influx
- Option expiries 10 am NY cut today 16 August
- Nikkei 225 closes on session lows down - 1.62 % at 16,596.51
Data:
- July 2016 UK CPI 0.6% vs 0.5% exp y/y
- UK PPI input July mm NSA +3.3% vs +1.0% expected
- August 2016 German ZEW economic sentiment 0.5 vs 1.8 exp
- June 2016 Eurozone trade balance 23.4bn vs 25.3bn exp SA
It's been a busy session with plenty of stand-outs with on-going JPY demand and USD selling still prevailing.
USDJPY and yen pairs in general were on the retreat to start with as the Nikkei closed on session lows and we saw the former chew through bids into 100.25 and post lows of 100.15 before finding a few buyers.
GBPJPY supply helped GBPUSD down to post 1.2885 but then came the reversal on core pairs just before the UK inflation data which saw GBPUSD post 1.2942 in a rush sending EURGBP back down from decent 0.8725 offers/res.
Cue the stronger data and we saw a further GBP-grab to 1.2995 and 0.8680 before sellers prevailed again to 1.2960 and 0.8695
Meanwhile the general USD-neg sentiment has seen EURUSD rally steadily to test 1.1300 having wiped its feet a couple of times at 1.1250 and 1.1280. USDJPY has made its way steadily below 100.00 to post 99.85 so far while USDCHF has continued its retreat to post 0.9606.
With all this going on NZDUSD has also had an extra leg up led seemingly by large AUDNZD interest today at 1.0600 . The pair has outpaced the AUDUSD rally to 0.7738 by reaching highs of 0.7299.
Now it's the turn of the US to show some inflation data along with housing starts at 12.30 GMT but it seems the market has already made its mind up there'll be no Fed hike anytime soon.
