EUR/USD
The major pair heads into the close broadly flat after trading in a 60-pip range with the price action being driven by central bankers and U.S. data. Governing board member Visco of the ECB sent the pair tumbling after reigniting concerns on negative deposit rates, by saying he would be in favour of such action, and the ECB stand ready to act should the data further deteriorate. After recouping the Visco-inspired losses, a bout of USD strength after expectation-beating retail sales data brought the pair to lows of 1.2942, but the move was rapidly retraced to head into the London close flat, but still below 1.30. Price action in the pair will be spurred by the German ZEW Survey due in tomorrow’s session, with Fed’s Plosser and ECB’s Asmussen also due to speak.
GBP/USD
The pair outperformed its EUR counterpart in early European trading hours after Visco’s negative deposit rate comments, with the continued expectations of a near-term improvement in the UK’s economic conditions allowing GBP to hold some ground against most others, ahead of this Wednesday’s Quarterly Inflation Report from the Bank of England’s economists. Momentum began to build in the EUR/GBP cross, with strong offers at 0.8470 capping upside, but once these offers were displaced, a bout of GBP weakness brought the major pair below 1.53, bringing the 50DMA back into focus at 1.5255.
USD/JPY
The pair broke 102.00 in Tokyo trade, after JGB futures were halted limit down for the second consecutive session and the Nikkei 225 continued to rally. The handle was not retained into European trade, which saw the pair drift lower with little impetus for upside, despite the weekend’s G7 statement placing no blame on the Japanese powers. The 102.00 level was broken once more in the wake of USD-inspired buying after advance retail sales prompted a number of brokers and investment banks to hike their USD GDP forecasts -- but again the pattern was not sustained. Japanese GDP figures on Thursday will clarify if the persistent JPY weakness has filtered through to the real economy.
The major pair heads into the close broadly flat after trading in a 60-pip range with the price action being driven by central bankers and U.S. data. Governing board member Visco of the ECB sent the pair tumbling after reigniting concerns on negative deposit rates, by saying he would be in favour of such action, and the ECB stand ready to act should the data further deteriorate. After recouping the Visco-inspired losses, a bout of USD strength after expectation-beating retail sales data brought the pair to lows of 1.2942, but the move was rapidly retraced to head into the London close flat, but still below 1.30. Price action in the pair will be spurred by the German ZEW Survey due in tomorrow’s session, with Fed’s Plosser and ECB’s Asmussen also due to speak.
GBP/USD
The pair outperformed its EUR counterpart in early European trading hours after Visco’s negative deposit rate comments, with the continued expectations of a near-term improvement in the UK’s economic conditions allowing GBP to hold some ground against most others, ahead of this Wednesday’s Quarterly Inflation Report from the Bank of England’s economists. Momentum began to build in the EUR/GBP cross, with strong offers at 0.8470 capping upside, but once these offers were displaced, a bout of GBP weakness brought the major pair below 1.53, bringing the 50DMA back into focus at 1.5255.
USD/JPY
The pair broke 102.00 in Tokyo trade, after JGB futures were halted limit down for the second consecutive session and the Nikkei 225 continued to rally. The handle was not retained into European trade, which saw the pair drift lower with little impetus for upside, despite the weekend’s G7 statement placing no blame on the Japanese powers. The 102.00 level was broken once more in the wake of USD-inspired buying after advance retail sales prompted a number of brokers and investment banks to hike their USD GDP forecasts -- but again the pattern was not sustained. Japanese GDP figures on Thursday will clarify if the persistent JPY weakness has filtered through to the real economy.