A rising USD/CNH translates into more pressure on JPY, AUD and NZD

USD/CNH tracks yield differentials almost as well as USD/JPY. Kit Juckes, Chief Global FX Strategist at Société Générale, analyzes FX markets – that are still watching central banks.

NOK/SEK has upside ahead of next week’s Norges meeting

Relative ECB and Fed rate paths suggest the euro remains vulnerable unless stronger European data emerges soon. EUR/GBP meanwhile, is tracking rate expectations very closely, but since we’ll get two more months’ worth of CPI data before the Sep 21 MPC meeting, a big lurch in expectations is unlikely, one way or the other.

USD/CNH tracks 10-year yields nearly as well as USD/JPY. The Chinese authorities may not want a weaker currency from here, but it’s hard to see this trend turning downwards until US yields peak. A rising USD/CNH translates into more pressure on JPY, AUD and NZD.

Finally, NOK/SEK is also tracking rate expectations closely. The Norges Bank is likely to raise rates by another 25 bps at next week’s meeting and that should be enough to keep the NOK bid.

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.