Forex news from the European trading session - 4 June 2018
Headlines:
- ECB rate hike bets are trickling back in
- Eurozone April PPI 0.0% vs +0.2% m/m expected
- Eurozone June Sentix investor confidence 9.3 vs 18.5 expected
- UK May construction PMI 52.5 vs 52.0 expected
- SNB total sight deposits w.e. 1 June CHF 576.5 bn vs 576.6 bn prior
- Switzerland Q1 non-farm payrolls 4.961m vs 4.962m prior
- Macron and Trump expected to hold talks on sideline of G7 summit
- Spain May unemployment change -83.7k vs -101.3k expected
- Japan's Aso to take a pay cut over document scandal
Markets:
- AUD leads, USD lags on the day
- European equities higher on the day, IBEX leads gains
- Gold up by 0.12% to $1,295.34
- WTI down by 0.62% to $65.40
- US 10-year yields flat at 2.905%
- Bitcoin up by 1.17% to $7,525
The session started with relatively narrow to decent ranges all around with the aussie leading the way after positive data beats from retail sales and Q1 data. But the dollar was already on the back foot alongside the yen, and it remained that way for the rest of the session.
Risk sentiment in the market has been positive to start the week with Asian stocks rising and that is seen in European equities now as well. And that is helping to lift the aussie and kiwi further on the day while also hurting the yen.
AUD/USD was trading around 0.7620 levels at the end of Asian trading, capped by AUD/JPY meeting a test of the 100-day MA, but once that level gave way we saw further extension in the aussie as AUD/USD reached a high of 0.7660 and stays near there now. The move in the aussie also dragged the NZD higher with NZD/USD now back above the 0.7700 level up to 0.7041.
It was a more subdued session for other major currencies, but all slowly posted gains against the dollar and the yen as the two currencies wither. EUR/USD stayed near 1.1700 before climbing above to test a high of 1.1737 as the dollar fell. At the same time, GBP/USD rose to a high near 1.3400 as well before retreating a little.
USD/JPY had yet another subdued trading session in Europe, with the daily range being 33 pips and the pair basically traded between 109.40 to 109.50 levels during the session.
There weren't any glaring headlines as we get into US trading, and the lack of key economic releases means that trading for the rest of the day will still be highly dependent on flow and sentiment.
