Forex Today: Aussie cheers risk reset; eyes on Treasury yields, US data

Dhwani Mehta FXStreet

Here is what you need to know on Friday, August 16th:

- The risk sentiment somewhat improved on Friday amid US President Trump’s optimistic comments on trade while upbeat US Retail Sales data offset recession fears.

- Markets ignored a weaker Yuan fix and looming Honk Kong concerns, as Treasury yields and US equity futures recovered. The Asian equities traded mixed, capping the upside in USD/JPY.

- USD/JPY traded firmer above 106.00, as the US dollar held onto its overnight gains, Japan's 10-year yield hit three year low. Gold eased below $ 1520 while oil prices rallied hard amid risk reset.

- The Aussie emerged the strongest while the Swiss Franc was the weakest heading into Europe.

- Brexit: 50 members of the opposition Labour party are ready to join Tory rebels to stop no-deal Brexit. UK FinMin Javid will travel to Berlin to meet the German counterpart Scholz and discuss Brexit deal.

- UK Retail Sales unexpectedly rose 0.2% m/m in July, suggesting that the UK economy is in much better shape than feared. GBP/USD regained 1.2100 while EUR/USD hovered around 1.1100 after ECB Rehn said that the ECB stimulus may beat expectations.

- Cryptocurrencies consolidated after Thursday’s rout. Bitcoin battles 10k mark.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD turns negative near 1.1850

EUR/USD has given up its earlier intraday gains on Thursday and is now struggling to hold above the 1.1850 area. The US Dollar is finding renewed support from a pick-up in risk aversion, while fresh market chatter suggesting Russia could be considering a return to the US Dollar system is also lending the Greenback an extra boost.

GBP/USD change course, nears 1.3600

GBP/USD gives away its daily gains and recedes toward the low-1.3600s on Thursday. Indeed, Cable now struggles to regain some upside traction on the back of the sudden bout of buying interest in the Greenback. In the meantime, investors continue to assess a string of underwhelming UK data releases released earlier in the day.