Forex news from the European trading session - 27 April 2020
Headlines:
- Apple reportedly pushes back mass production of its 2020 flagship iPhones
- UK PM Johnson: We cannot say when changes to restrictions will be made
- UK PM Johnson: We are making progress against the coronavirus outbreak
- SNB total sight deposits w.e. 24 April CHF 650.7 bn vs CHF 637.2 bn prior
- BOJ's Kuroda: Price momentum has been lost for now
- BOJ's Kuroda: Japanese economy expected to remain in severe state for some time
- Thailand to extend state of emergency to 31 May
Markets:
- AUD leads, CHF lags
- European equities higher; E-minis up 0.8%
- US 10-year yields up 1.7 bps to 0.618%
- Gold down 0.8% to $1,716.00
- WTI down 17% to $14.07
- Bitcoin up 2.3% to $7,705
It was a session that lacked significant headlines but the market was more optimistic, focusing on the reopening of economies - particularly in Europe - instead.
As such, the dollar was weaker throughout the session while risk-on sentiment played out in the equities space, with European stocks benefiting from the positive tone.
The BOJ easing policy by going 'unlimited' and Italy escaping a ratings downgrade last Friday are also factors helping with the mood as we get the week going.
AUD/USD rallied strongly since Asia Pacific trading, but extended gains to over six-week highs from 0.6440 to 0.6469 during the session.
Meanwhile, EUR/USD climbed from 1.0830 to 1.0860 before easing a little to 1.0840 after running into some near-term resistance around 1.0850-59.
USD/JPY also fell from 107.40 to 107.05 as the dollar remained weak throughout.
Elsewhere, oil prices continue to stay pressured with WTI crude down by ~17% near $14.
Looking ahead, investors are taking heart in the easing of lockdown restrictions but there are still plenty of question marks left hanging on the week.
Central bank focus will return with the Fed and ECB on the agenda, and we will have key earnings releases to follow as well. The forward guidance by key corporates will be of particular importance in affecting the risk mood over the next few days.
