Euro is driving the currency bus
We were expecting a significant downside EONIA response to the weakening EUR, but the lack there off suggests the markets see a stronger probability of an ECB rate cut not QE at this stage.
So, with the market pricing in a ten bp ECB depo rate cuts in September and December, which suggest the FOMC have “out dove" the ECB's current messaging, as such the USD remains prone to further long liquidation.
Oil Things considered
AUD and CAD
Once the short-term effect from escalation tensions in Iran wane, and the market returns focus to global demand, commodity currencies could fall under pressure, but given the Greenback is in the middle of longer-term death throes these dips could provide an excellent buying opportunity notably if the worst case g20 scenarios are averted. Which remains the markets base case scenario?
I will follow up with Asia market after the CNY Fix as we remain on “Yuan Yuatch” (sic)
SPI Asset Management provides forex, commodities, and global indices analysis, in a timely and accurate fashion on major economic trends, technical analysis, and worldwide events that impact different asset classes and investors.
Our publications are for general information purposes only. It is not investment advice or a solicitation to buy or sell securities.
Opinions are the authors — not necessarily SPI Asset Management its officers or directors. Leveraged trading is high risk and not suitable for all. Losses can exceed investments.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.