Forex news from the European trading session - 9 April 2021
Headlines:
- Merkel talks with state leaders on Monday has been cancelled
- Dollar gains kept in-check so far on the session
- UK March Halifax house prices +1.1% vs -0.1% m/m prior
- Treasury yields creep higher to start European morning trade
- Switzerland March unemployment rate 3.4% vs 3.6% expected
- Germany reports 25,464 new coronavirus cases, 296 deaths in latest update today
Markets:
- USD leads, JPY lags on the day
- European equities a little higher; S&P 500 futures up 0.2%
- US 10-year yields up 4.6 bps to 1.665%
- Gold down 0.5% to $1,747.25
- WTI down 0.1% to $59.56
- Bitcoin up 1.9% to $58,758
The session got off to a quick start as Treasury yields crept higher and that saw bids flow into the dollar, sending the greenback higher across the board.
Nasdaq futures pared its early advance to fall by 0.2% before keeping flatter now while Dow futures gained on that and is up 0.3% ahead of US trading now.
10-year Treasury yields climbed up by roughly 5 bps to 1.67% and that serves as another reminder that the reflation theme is still very much part of the market narrative.
The early April moves may yet just be tied to profit-taking from what we have seen in Q1 but we'll see how things play out as we get into the weeks ahead to be sure.
In any case, the dollar gained early on but has seen its advance trimmed somewhat in the past few hours. EUR/USD moved lower from 1.1905 to 1.1882 and is still seen holding just above its 200-day moving average @ 1.1886 currently.
USD/JPY was a notable gainer as it pushed up from 109.30 to 109.75 and is holding near the highs for the day with yields continuing to look perky as well.
GBP/USD saw a quick drop from 1.3730 to 1.3670 as EUR/GBP threatened a push towards 0.8700 before the latter retreated and that allowed cable to bounce back to 1.3720.
Commodity currencies also trailed the dollar but have pared most of its earlier losses, with USD/CAD rising to 1.2611 before falling back to 1.2570. Large expiries at 1.2600 are also playing a bit of a role in limiting gains on the session so far.
AUD/USD also declined from 0.7640 to 0.7588, testing support around 0.7592-96 before rebounding back to its 100-hour moving average @ 0.7638 currently.
Elsewhere, gold eased after testing short-term resistance around $1,755 to fall to $1,740 levels at the moment - prompting questions on the strength of its latest bounce.
As we look to the weekend, it's still all about the bond market and risk sentiment with US PPI data set to reaffirm more upwards price pressures - largely due to supply bottlenecks.
