Forex Today: sees risk-recovery in Asia, UK earnings in spotlight

Forex today witnessed a recovery in risk appetite, despite looming US-China trade concerns, as the renewed optimism on the Brexit deal and NAFTA lifted market sentiment. As a result, the safe-haven Yen was broadly sold-off, driving the USD/JPY pair closer towards 111.50 barrier while the Antipodeans attempted a tepid recovery, as the Aussie shrugged off a dip in the Australian NAB business confidence gauge.  Moreover, the commodity-currencies also derived support from positive commodities’ prices and a risk-on rally seen in the Asian equity markets.

Meanwhile, the pound consolidated the overnight gains just under the 1.3050 level while the common currency wavered around the 1.16 handle. The Canadian dollar also traded firmer near 1.3150 versus its American counterpart amid ongoing NAFTA talks.

Main topics in Asia

US mulls China sanctions over Muslim abuses - The New York Times

North Korea's Kim looking for fresh Trump meeting - Reuters

Brexit could cost London billions - The UK Times

Fitch ratings affirm Singapore at 'AAA', outlook Stable

Japan’s Motegi: Japan, US have some differences in views on trade, but will try to resolve

Russia’s Novak: OPEC and allies can keep output quotas in place even after 2018

Asian stocks see gains, emerging markets remain shaky

BoJ seen willing to raise its ETF target if buying jumps a lot - Bloomberg

 FT report: Tory Eurosceptics fail to agree on Brexit plan B

Key Focus ahead

Heading into Europe, markets eagerly await the release of the UK labor market report at 0830 GMT, as the Kingdom’s wage growth numbers remain the main focus, which is expected to inch higher to 2.8% in July versus 2.7% booked in June. Also, of relevance remains the German ZEW economic surveys that will be reported at 0900 GMT alongside the Eurozone ZEW surveys and employment data.

The NA session appears data-light, with the second-liner Canadian housing starts and the US JOLTS job openings due on the cards at 1215 GMT and 1400 GMT respectively. Meanwhile, markets will continue to take cues from the Brexit and trade-related developments for some trading impetus.

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