Heading into the close, the FTSE 100 is 50 points lower, as equities struggle once again.
- Stock markets in retreat
- Domino’s Pizza turns stale
- USDJPY breaks higher
A small recovery in US markets at the beginning of the session is already beginning to fizzle out, while the US dollar is doing well ahead of Fed minutes, on the expectation that the account of the most recent meeting will show a committee still keen to raise rates. As has been the case for the week thus far, attention has focused mainly on sterling, thanks to the absence of heavy-hitting UK data. The pound continues to lose ground, testing the water below $1.22 again, although indications that the UK government may have to navigate Parliament before activating Article 50 have helped to stem downside in cable today. It has been a miserable day for Domino’s Pizza on the FTSE 250, after a poor trading update this morning; against smaller, more nimble firms like Just Eat, Domino’s relatively narrow offering makes it look unimpressive versus the sheer variety on offer at its competitors.
In a quiet session the main event, Fed minutes, is still to come, and could yet reverse the weakness in equities and the relatively sparky performance of the dollar. Of particular note this afternoon is a possible breakout in USDJPY, which is finally trying to move meaningfully above Y104. 2016 has been, by and large, a year of yen strength, but it will be music to Shinzo Abe’s ears if the Japanese currency finally begins to fall. After all, if the UK can do it, why not Japan?
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Editors’ Picks
EUR/USD flirts with daily highs, retargets 1.1900
EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.
GBP/USD remains well bid around 1.3650
GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.
USD/JPY edges up above 153.50 with all eyes on US CPI figures
USD/JPY appreciates above 153.00 but remains on track for a 2.4% weekly loss. Trading volumes remain subdued on Friday, ahead of the IS CPI release. The Yen remains supported by hopes of a stable government and calls for further BoJ tightening.
Editors’ Picks
EUR/USD: Yes, the US economy is resilient – No, that won’t save the US Dollar Premium
Some impressive US data should have resulted in a much stronger USD. Well, it didn’t happen. The EUR/USD pair closed a third consecutive week little changed, a handful of pips above the 1.1800 mark.
Gold: Metals remain vulnerable to broad market mood Premium
Gold (XAU/USD) started the week on a bullish note and climbed above $5,000 before declining sharply and erasing its weekly gains on Thursday, only to recover heading into the weekend.
GBP/USD: Pound Sterling remains below 1.3700 ahead of UK inflation test Premium
The Pound Sterling (GBP) failed to resist at higher levels against the US Dollar (USD), but buyers held their ground amid a US data-busy blockbuster week.
Bitcoin: BTC bears aren’t done yet
Bitcoin (BTC) price slips below $67,000 at the time of writing on Friday, remaining under pressure and extending losses of nearly 5% so far this week.
US Dollar: Big in Japan Premium
The US Dollar (USD) resumed its yearly downtrend this week, slipping back to two-week troughs just to bounce back a tad in the second half of the week.
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