The Euro has opened the new trading week marginally higher against the Greenback following initial results from the Parliamentary elections in Europe, suggesting that the mainstream have managed to hold ground against the feared outcome of another populist wave in the European Union.Provisional results indicate some narrowing of support for populist and Euro-sceptic parties and thissuggests that momentum for the anti-establishment is relatively constrained, at least for now, meaning the Eurodollar should find some initial support from hopes of policy continuity in Europe.

These European Parliamentary election results do not suggest a near-term shock is awaiting for Eurozone politics, highlighting that the direction of the Euro over the longer-run will be determined by global forces, such as what happens next in the narrative with the US-China trade outlook.

President Trump visit to Japan not a warning shot of US-Japan trade tensions to come

As United States President Donald Trump continues his four-day visit to Japan the theme of what happens next with the global trade outlook is very much the question that remains on the mind of global investors.

President Trump’s tour has of course been followed closely by the shadow around what could be next to come in the global trade outlook, but the meetings between the United States President and Japanese Prime Minister Shinzo Abe do not suggest that there will be a sudden shift in market anxiety to a US-Japan trade breakout quite yet.

China warns not to short the Yuan!

The offshore Chinese Yuan managed to climb briefly below the 6.90 level for the first time since May 15 after a stark warning from the head of China’s banking and insuranceregulator that those who short the Yuan will “inevitably suffer a huge loss”.  This has been broadly digested as a warning shot for investors that even following the escalation in the tit-for-tat tariffs this month that China has not changed its view on allowing the offshore Yuan to weaken in defence of more tariffs.

Seven overall remains the magic number in the USDCNH and the comments made by the head of China’s banking and insurance provide guidance that Chinese authorities will not hesitate to intervene in the FX markets should they feel the need to do so.

This is not only seen as Yuan-positive but also expected to come to the aid of currencies throughout the Asian region that have needed to contend with unexpected downside risks this month following the downside pressure in the Yuan. This warning from China presents just as positivea wave of momentum for the likes of the Malaysian Ringgit, Indonesian Rupiah andSingapore Dollar as it does for the Chinese Yuan.

South African President Ramaphosa vows “new era” at inauguration 

The European Parliamentary elections and United States President Trump visit to Japan are not the only political events to have taken place over the weekend, with Cyril Ramaphosa declaring his intention to bring “hope and renewal” to South Africa in his inauguration speech as President of South Africa. 

Since Mr Ramaphosa took charge of South Africa close to a year ago from Jacob Zuma he has been under the spotlight to improve a South African economy that has underwhelmed for years, and continues to lag behind the progress emerging markets in other areas of the world have made in the past decade.

Disclaimer:This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.

Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 90% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Feed news

Latest Forex Analysis

Editors’ Picks

EUR/USD under pressure near 1.1380 ahead of Powell

EUR/USD sees fresh selling and tests daily lows near 1.1380 region amid a broad-based US dollar comeback, as all eyes remain on the Fed Chair Powell's speech for fresh insights on the US interest rates outlook. 

EUR/USD News

GBP/USD keeps gains near 1.2760 post-UK data

The GBP/USD pair keeps the bid tone intact near the 1.2760 region despite a sharp drop in the UK CBI Retailing Reported Sales and broad US dollar recovery. Eyes on Powell's speech. 

GBP/USD News

USD/JPY: recovers to 107 area as markets wait for Powell's speech

10-year US T-bond yield extends slide, drops below 2%. US Dollar Index stays calm near the 96 mark. Fed's Williams & Bostic, FOMC Chairman Powell are scheduled to speak later today.

USD/JPY News

US Conference Board Consumer Confidence Preview: Employment sustains optimism

Income gains, employment and general economic prosperity support confidence. Decline in Q2 GDP not impacting sentiment. Low inflation and faling interest rates are positive consumer trends.

Read more

Gold consolidates recent upsurge to multi-year tops, comfortable above $1400 mark

Gold adds to the post-FOMC upsurge amid escalating geopolitical tensions. A modest USD uptick/stability in equity markets prompts some profit-taking. The downside remains limited ahead of Powell’s speech later this Tuesday.

Gold News

Majors

Cryptocurrencies

Signatures