FX News Today

European Outlook: Asian stock markets headed south, led by Japan with the Nikkei losing -1.13%, as the dollar was further pressured by U.S. rhetoric on USD and trade. U.S. stock futures are down in tandem with FTSE 100 futures as the focus turns to the ECB meeting today as a strong data round so far this week has rekindled concerns of a major shift in guidance. The strong PMI readings out of the Eurozone and the rise in U.K. employment numbers coupled with a stronger pound saw U.K. bond markets underperforming yesterday and yields surging higher led by Gilts, while the FTSE 100 underperformed amid a wider dip in equities. With the pound remaining strong and the ECB meeting hanging over markets we are unlikely to see a major correction during the AM session and ahead of key surveys in the form of the German Ifo and the U.K. Distributive trade survey. Meanwhile we expect Draghi to continue to move cautiously, although that the ECB is heading for an exit from QE this year is pretty clear.

FX Update: USDJPY is down for a third straight day, this time logging a four-month low of 108.73. Broader dollar declines has once again been driving, with the buck making fresh lows versus a range of other currencies. EURJPY and other yen crosses have been trading comparatively steadily. Stock markets in Asia have come off the boil amid concerns about Trump’s protectionist bent, and after his Treasury Secretary’s verbal embracement, yesterday, of the weakening dollar trend, which many are calling the “Mnuchin Moment”. The dollar, which is down for a fifth consecutive quarter, which is the most protracted decline since 2007-8, is posting its biggest monthly loss in over two years. There at signs that this is causing some consternation in Asia, with a Bloomberg report today citing South Korean policymaker has affirming that “excessive” movements in USD-KRW are being “monitored.”

Charts of the Day

Main Macro Events Today        

  •  ECB Rate Decision & Statement & Press Conference – 12:45 and 13:30 GMT – Asset purchasing is ending – but when and how is the Hawk/Dove Debate – how will Draghi play this with and appreciating EUR ?
  •  German Ifo – Expectationsa slight dip in the reading to 117.0 from 117.2
  • Canadian Retails Sales – Expectations – Decrease to 0.7% from 1.5% last time  

Support and Resistance Levels

Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:

Stuart Cowell

Senior Market Analyst


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.