ecb hawkish

Summary:

  • The Euro continues to be one of the more susceptible currencies as many headwinds build up.
  • Will Russia resume gas supply to Noord Stream?
  • Will the BoC policy decision offer CAD support?
  • BoJ would do whatever is necessary to help the economy grow.

Read next: Recession Fears Are Affecting Brent Crude Prices, Silver Price vs A Hawkish Federal Reserve, Corn At 8-Week Highs 

US Dollar continues to strengthen across the board

The market is reflecting mixed signals for this currency pair. On Monday the Noord Stream, Germany’s biggest pipeline closed for annual maintenance until the 21st July. The maintenance time period has increased speculation on whether or not Russia will resume gas flows after the maintenance has been completed. The Euro continues to be one of the more susceptible currencies as many headwinds build up. The European Central Bank (ECB) is still on track to raise interest rates (at least 25 bps) at their next meeting later on in July.

The US Dollar

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ECB Offering The Euro Support (EUR/USD), Strengthening Of The Renminbi Supporting The EUR and GBP, SNB Turns Hawkish (EUR/CHF) - Good Morning Forex!

Rebecca Duthie Rebecca Duthie 23.05.2022 10:29
Summary: ECB offering support to the EUR, whilst easing lockdowns in China aids in the weakening US Dollar. Euro and GBP are likely to strengthen with the Renminbi. SNB and ECB hawkishness offers support to their respective currencies. GBP/CAD Read next: US Dollar Is Likely To Experience Volatility In The Coming Weeks (EUR/USD), UK Retail Data Exceeds Market Expectations (EUR/GBP), SNB Turns Hawkish Causing the CHF To Rally (EUR/CHF) - Good Morning Forex!  Easing lockdowns in China dragging down the US Dollar Market sentiment for this currency pair is reflecting bullish signals. On Monday the European Central Bank (ECB) announced that it is likely that July would be the starting period for raising interest rates. At the same time, the easing of lockdowns in China has aided in weakening the US Dollar. The trading week is full of US events along with some European Central Bank events, all of which will be watched closely. EUR/USD Price Chart Euro and GBP both showing signs of strengthening Market sentiment for this currency pair is reflecting mixed signals. The prospect of the Chinese Renminbi rebounding is likely to have a positive impact on the value of both the Pound Sterling and the Euro. In addition the market believes that the Bank of England (BoE) is likely to continue raising interest rates in the coming months along with the increased likelihood of the European Central Bank (ECB) raising the interest rates. EUR/GBP Price Chart SNB and ECB hawkishness caused mixed sentiment for this currency pair. On Thursday last week the president of the Swiss National Bank (SNB) said that they were ready to act on the rising inflation, the hawkishness of the SNB caused the Swiss Franc to rally. The potential hawkishness of the European Central Bank (ECB) is also causing the Euro to strengthen, leaving the market sentiment for this currency pair showing mixed signals. EUR/CHF Price Chart GBP rallies against the CAD The strengthening of the GBP against the CAD throughout last week has come in the wake of increasing UK government bond yields. The strengthening came in the wake of the release of UK employment data, inflation and retail data all which support further increases in the UK government bond yields. GBP/CAD Price Chart Read next: (FTSE) FTSE 100 Rallies In Response To Positive Economic Data, US Dollar Expected To See More Volatility  Sources: finance.yahoo.com, poundsterlinglive.com, dailyfx.com
Britain's Rishi Sunak And EU's Ursula Von Der Leyen Will Meet Today To Finalize The Northern Ireland Drama

FOMC Meeting Minutes Offer Support To The US Dollar (EUR/USD), Improved Market Attitude Favoured The GBP On Thursday (EUR/GBP, GBP/USD), Market Awaits RBA Monetary Policy - Good Morning Forex!

Rebecca Duthie Rebecca Duthie 26.05.2022 11:58
Summary: Investor confidence in both the Euro and US Dollar causing mixed sentiment for the EUR/USD currency pair. GBP beats Euro and USD despite poor PMI data released on Tuesday. RBA June policy meeting will determine the AUD strength Read next: Hawkish ECB Bodes Well For The Euro, UK PMI Data Disappoints (EUR/GBP), Hawkish SNB Offers Swiss Franc Still Support (USD/CHF), AUD/JPY - Good Morning Forex!  Mixed sentiment for the EUR/USD The market is reflecting mixed market signals for this major currency pair. In the Wake of the FOMC meeting minutes, the US Dollar has found some stability. The market can expect a 50bp interest rate hike at the next two Fed meetings, with a possible pause in the hikes later on in the year. The Euro is also on an upward streak with the strong possibility of the European Central Bank (ECB) tightening monetary policy in July. EUR/USD Price Chart GBP strengthens The market is reflecting bearish market sentiment for this currency pair. On Thursday the GBP recovered some of its losses against the Euro after the UK PMI report on Tuesday. Improved market attitude acted in favour of the Pound Sterling against the Euro on Thursday. However, the outlook for the GBP still looks challenging going forward with an overly cautious Bank of England, high-inflation and global risk aversion. EUR/GBP Price Chart GBP/USD reflecting bullish sentiment Market sentiment for this currency pair is reflecting bullish signals. On Thursday the GBP recovered some of its losses against the US Dollar. Improved market attitude acted in favour of the Pound Sterling against the US Dollar on Thursday. GBP/USD Price Chart Future of the AUD waits the RBA monetary policy decision The market is reflecting bullish signals for this currency pair. The Reserve Bank of Australia (RBA) June policy meeting will likely see a future hike in interest rates. If the RBA tightens their monetary policy the Australian Dollar could strengthen. If the RBA chooses a dovish approach, the Aussie Dollar could struggle. AUD/USD Price Chart Read next: EUR Falls To US Dollar (EUR/USD), Pound Sterling Due To Weaken As UK Recession Looms (EUR/GBP), Market Awaits Fed Meeting Minutes (USD/CHF, GBP/USD)  Sources: finance.yahoo.com, dailyfx.com, poundtserlinglive.com
Crucial Upcoming PMI Data and High-Stake Meetings Shape China's Economic Landscape

Euro Enters The Week Strong As The Market Awaits ECB Announcements Due Later This Week (EUR/USD, EUR/GBP, EUR/CHF), Focus On The RBA Announcement On Tuesday (GBP/AUD)

Rebecca Duthie Rebecca Duthie 06.06.2022 15:22
Summary: ECB interest rate decision due to occur later this week. Confidence vote being held for Boris Johnsson later on Monday. Investor confidence could be returning to the markets. On Tuesday the Reserve Bank of Australian (RBA) is due to announce its decision regarding tightening of monetary policy. Read next: Altcoins: Decentraland (MANA), What Is It? A Deeper Look Into The Decentraland Platform  EUR strong entering the week On Monday market sentiment for this currency pair turned bearish. The Euro opened stronger on Monday as the market awaits the European Central Banks (ECB) interest rate decision, which is due to occur later this week. If the European Central Bank shows any signs of dovish intentions, the effects could be heavy on the Euro's downside, however, if a hawkish attitude is shown (which seems to be more likely), the upside effect on the euro may be minimal as the expected hike is already priced into the market. U.S CPI data is expected to close off this week, if there is another undershoot regarding the CPI data, it will just confirm that inflation has reached its peak and add to dovish pressure. EUR/USD Price Chart Both Euro and Pound sterling entered the week strong The market is reflecting mixed signals for this currency pair. As the market awaits the European Central Bank's (ECB) announcement regarding the decision for interest rates in July and September, the Euro entered the week strong. In addition, the pound sterling also entered the week strong despite a confidence vote being held this evening to determine Prime Minister Boris Johnssons future as leader. The pound sterling holding strength, shows its resilience to political tensions. EUR/GBP Price Chart EUR/CHF bullish The market is reflecting bullish signals for this currency pair. Amidst the expected announcements from the European Central Bank this week, the Euro has entered the week strong, even against the safe-haven Swiss Franc. During times of economic stress, investors normally turn to safe-haven assets, however investor confidence seems to be returning to the markets. EUR/CHF Price Chart RBA due to make an announcement The Australian Dollar entered its third week of gains this week in the wake of China’s easing of Covid-19 lockdowns and stronger than expected GDP data. However, on Tuesday the Reserve Bank of Australian (RBA) is due to announce its decision regarding tightening of monetary policy. The price of the GBP/AUD currency pair is sensitive to the price changes of the GBP/USD currency pair. GBP/AUD Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com
Serious liquidity crisis? According to Franklin Templeton, a massive, but unlikely deposit flight from Credit Suisse would have to happen

ECB Interest Rate Announcement Due Tomorrow Offers Euro Support (EUR/USD, EUR/GBP), JPY Facing Negative Outlook (USD/JPY), Potential For A Hawkish SNB Offers CHF Support (USD/CHF)

Rebecca Duthie Rebecca Duthie 08.06.2022 16:22
Summary: Markets are becoming more optimistic around hopes of a more hawkish European Central Bank (ECB). Firmer oil prices adding to downward pressure on JPY. Strong market expectations of a more hawkish Swiss National Bank (SNB). Read next: DOW 30 Turbulent In The Wake Of Targets (TGT) Profit Warning, Japanese Yen Suffering From BoJ Monetary Easing  Euro holds steady The market is reflecting mixed signals for this currency pair. The markets are becoming more optimistic around hopes of a more hawkish European Central Bank (ECB) tomorrow after adding a couple more basis points to the yearly forecasts. There has been talk of a 50bps hike in July and rumors of a possible hike on Thursday, it is likely that the market could see a change in ECB tone which has allowed the Euro to remain resilient against the US Dollar. On Wednesday, the market opened with strong economic Q1 data for the eurozone. The euro did not react instantly to the release of this data, likely due to its delay. EUR/USD Price Chart Anticipation of ECBs announcement offers Euro support The market is reflecting mixed signals for this currency pair. The Euro has gained against the pound sterling ahead of the market awaiting the European Central Banks (ECB) interest rate announcement, which is due tomorrow. Earlier in the trading week the pound sterling rallied in response to the news of Boris Johnssons vote of no confidence. If the ECB announces an interest rate hike in July, the pound sterling currency could be under pressure against the Euro. EUR/GBP Price Chart Negative outlook for Japanese Yen is likely to continue The market is reflecting bullish signals for this currency pair. In addition to the Bank of Japan (BoJ) continuing its monetary easing, firmer oil prices have added to the downward pressure on the Japanese Yen and both of these factors will continue to add to the negative outlook for the safe-haven currency. USD/JPY Price Chart CHF holding its position in the market The market is reflecting bullish signals for this currency pair. The Swiss Franc has recovered against the US Dollar in comparison to the lows experienced in mid-May when the US Dollar was at its strongest, the recovery comes in the wake of market expectations of a more hawkish Swiss National Bank (SNB). the expectations come from indications from policy makers that the SNB will increase its interest rates for the first time since the 2008 financial crisis. USD/CHF Price Chart Sources: finance.yahoo.com, poundsterlinglive.com, dailyfx.com
ECB press conference brings more fog than clarity

Strong Expectations For ECB To Hike Interest Rates Is Offering The Euro Support (EUR/USD, EUR/GBP), Hawkish RBA is Offering AUD Support (AUD/JPY), US Dollar Benefitted From AUD Risk Sensitivity (AUD/USD)

Rebecca Duthie Rebecca Duthie 09.06.2022 12:26
Summary: ECB announcement due on Thursday, analysts expect hawkish moves. Dovish BoJ causing the safe-haven asset to weaken. The market is reflecting bearish signals for the AUD/USD currency pair. Read next: Alibaba (BABA) Amongst US Listed Chinese Stocks That Have Seen Major Gains  ECB expected hawkish attitude supporting EUR The market is reflecting bullish signals for this currency pair. The highlight of the Thursday trading day for the foreign exchange markets is the European Central Banks (ECB) announcement. Over the past few weeks, members of the ECB have been stressing the need for interest rate hikes in July with the bank's president, Christine Lagarde saying the July hioke would likely be followed by a September hike. The strong expectations are offering the Euro support against the US Dollar. EUR/USD Price Chart Euro strengthens against the GBP The market is reflecting bullish signals for this currency pair. The Euro could strengthen further against the pound sterling if the European Central Bank (ECB) ends up turning hawkish as analysts expect. Over the past few weeks, members of the ECB have been stressing the need for interest rate hikes in July with the bank's president, Christine Lagarde saying the July hioke would likely be followed by a September hike. EUR/GBP Price Chart RBA hawkish vs BoJ dovish The market is reflecting bullish signals for this currency pair. The AUD/JPY currency pair is one of the more volatile currency pairs. The Australian Dollar has gained on the safe-haven Japanese Yen over the past week due to the Reserve Bank of Australia (RBA) turning hawkish and the Bank of Japan (BoJ) choosing to continue with monetary easing. AUD/JPY Price Chart US Dollar benefitted from AUD risk sensitivity The market is reflecting bearish signals for this currency pair. Inflation worries resurfaced on Wall Street, which drove US stocks lower, this sentiment may have a domino effect on the Asia-Pacific markets. The fall in sentiment weighted on the risk-sensitive Australian Dollar, thus benefiting the US Dollar in this currency pair. AUD/USD Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com
Rising U.S. Treasury Bond Yields Have Helped The USD/JPY Bulls

US CPI Inflation Acceleration Likely To See Hawkish Fed Retaliation (EUR/USD), On Thursday The Market Expects The BoE Monetary Policy Decision (EUR/GBP)

Rebecca Duthie Rebecca Duthie 13.06.2022 14:42
Summary: High US CPI inflation is likely to cause the Fed to retaliate, offering USD support. The market is reflecting mixed market signals for the EUR/GBP currency pair. Sharp decline in the value of the JPY sparks BoJ response. Read next: US CPI Data Due On Friday Offers USD Support (EUR/USD, USD/JPY, USD/CHF), Pound Sterling Rallies Against Euro Due To The ECB Press Conference Ambiguity (EUR/GBP)  EUR/USD Bearish as the market expects a hawkish Fed The market is reflecting bearish signals for this currency pair. The Euro to US Dollar exchange rate fell heavily during last week's trading week in the wake of a toxic combination of international and domestic headwinds and could likely remain under pressure in the coming days if the Fed and US bond yields continue to wear down global investor sentiment. The high US CPI inflation rate indicates that inflation is showing no signs of peaking, the Federal reserve is likely to continue on its hawkish path of tightening monetary policy, which is offering the USD support. EUR/USD Price Chart Hawkish BoE could offer GBP support The market is reflecting mixed market signals for this currency pair. On Thursday the Bank of England (BoE) is due to make a monetary policy decision, if the Bank adopts a more hawkish tone, the pound sterling could strengthen against the EUR. However, economists don't expect a large increase in interest rates and the BoE has been pushing back from hawkish market expectations for its interest rate to reach either 2% or more by year end. EUR/GBP Price Chart BoJ may be ready to step in to save the JPY The market is reflecting bullish signals for this currency pair. On Friday the Bank of Japan (BoJ) made a joint government statement which echoed the concerns over the yen’s sharp decline, which indicated that the BoJ may be ready to respond appropriately. In his latest address to parliament, Kuroda stated, "The yen's recent sharp declines are negative for Japan's economy and therefore undesirable, as they make it hard for companies to set business plans". USD/JPY Price Chart AUD/JPY currency pair The market is reflecting bullish market sentiment for this currency pair. The sharp weakening of the Japanese Yen has caused the BoJ to hint plans of stepping in to save the safe-haven currency. AUD/JPY Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com  
Credit Suisse case: Western Assets expects Swiss authorities to act if sentiment doesn't improve

Data Showed A Slowing Eurozone Economy (EUR/USD, EUR/CHF), UK PMI Data Came In Stronger Than Expected (EUR/GBP), NZD Was The Top Performing Currency On Thursday (GBP/NZD)

Rebecca Duthie Rebecca Duthie 23.06.2022 15:44
Summary: Eurozone data showed a slowing European economy for June. Pound sterling offered support from strong UK PMI data. NZD was Thursday's top performing currency. Read next: Fears Of Recession Loom (EUR/USD), UK CPI Inflation Data 9.1% For May (EUR/GBP), Surprisingly Strong Canadian Inflation Data (USD/CAD), EUR/JPY  Euro weakened in the wake of slowing economy data The market is reflecting mixed signals for this currency pair. The Euro fell sharply on Thursday in the wake of data that showed that the Eurozone economy had slowed during June and undermined the expectations for a series of rapid interest rate hikes from the European Central Bank (ECB) that are due to start in July. The fall in the Euro helped reinforce a bid for the US Dollar against all major pairs as investors continue to bet on a global economic slowdown. ` EUR/USD Price Chart UK PMI data beat market expectations The market is reflecting mixed market sentiment for this currency pair. The UK economy continued to grow during June as UK PMI data came in stronger than the market expected. At the same time UK wage pressures remained strong at firms that were increasingly willing to pass on price increases to customers, which is likely to continue to place pressure on the Bank of England (BoE) to raise interest rates. EUR/GBP Price Chart GBP/NZD upside risk The New Zealand Dollar was one of the top performing major currencies on Thursday when the NZD/USD pair seemed to be drawing dip-buyers from the market. The Pound to NZD has been contained over the past month, but with the NZD/USD pair testing major support levels, it is possible that the breakout risk for the GBP/NZD is on the upside. GBP/NZD Price Chart EUR/CHF The market is reflecting bearish signals for this currency pair. As the Swiss Franc continues to strengthen in the wake of the Swiss National Banks (SNB) interest rate hike, the Euro is weakening due to unfavourable economic data. EUR/CHF Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com
The Upside Of The EUR/USD Pair Remains Limited

EUR/USD Currency Pair Bullish, KPMG Cuts Growth Forecast For Pound Sterling (EUR/GBP, GBP/USD), RBC Capital Markets Recommend Selling GBP/SEK

Rebecca Duthie Rebecca Duthie 27.06.2022 13:38
Summary: RBC are so confident in this they recommended selling the GBP/SEK currency pair. Euro’s concerns lie in the rising energy prices and possible supply chain disruptions. KPMG cut UK economic growth forecasts for 2022 and 2023. Recession concerns are weighing on the US dollar. Read next: Concerns Of A Global Recession Continue To Weigh On Markets - Take A Look At The EUR/USD, EUR/GBP, GBP/AUD And EUR/JPY Currency Pairs  EUR and USD facing economic concerns The market is reflecting bullish signals for this currency pair. Federal Reserve Chairman, Jerome Powell reiterated in congress that it will be tough for the Fed to bring inflation down without harming the economy or disrupting the labour market, this began a downward revision to market expectations for US interest rates. The biggest concern for the Euro lies in the economic hit in the wake of rising energy prices and possible supply disruptions. Hence, the European Central Bank (ECB) views this as a medium-term source of disinflation, which is yet another reason to take a slower, more cautious approach to normalising monetary policy that has been priced in over the past months. EUR/USD Price Chart EUR/GBP currency pair The market is reflecting bullish signals for this currency pair. KPMG cut UK economic growth forecasts for 2022 and 2023, the cut comes from the expectation of a “mild” recession in the UK economy in 2023, in the wake of surging commodity prices and China's Covid outbreak. News of the downgrade in expectations is driving the Euro to strengthen against the pound sterling. EUR/GBP Price Chart Strong Sell recommendations for the GBP/SEK RBC Capital Markets’ foreign exchange strategists are warning that the pound is likely to suffer losses in the near-term against the Swedish Krona. They are so confident in this they recommended selling the GBP/SEK currency pair. The GBP is expected to take a hit at the end of the Month due to the release of important economic data. GBP/SEK Price Chart US recession concerns weighing on the US Dollar The market is reflecting bullish signals for this currency pair. During last week's trading week, the narrative changed from inflation concerns to recession concerns which are weighing on the US Dollar via lower treasury yields. The UK PM Borris Johnson is looking to hold onto his PM status and run for a 3rd term. GBP/USD Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com
The Collapse Of The Silicon Valley Bank Weakened The Dollar And USD/JPY But Supported EUR/USD, AUD/USD, And GBP/USD

US Dollar Hitting 19-year Highs (EUR/USD, GBP/USD), Russia Cuts Off Gas Taps (EUR/GBP), GBP/AUD Currency Pair & RBA Policy Decision

Rebecca Duthie Rebecca Duthie 05.07.2022 17:21
Summary: The US Dollar is hitting 19 year highs on Tuesday. Russia turns gas taps off Europe, plunging the Euro. UK strikes over pay began on Tuesday. RBA policy decisions lacked hawkish rhetoric. Read next: A Global Economic Slowdown Is Causing Risk-Off Sentiment, The US Dollar Remains Strong and AUD Expected To Be Currency Most Affected (EUR/USD, EUR/GBP, GBP/AUD  US Dollar Continues on its strengthening path The market is reflecting bearish signals for this currency pair. The US Dollar is hitting 19 year highs on Tuesday, this has been helped by a plunging EUR/USD currency pair, which has set its own 19-year low. Whilst there has been no particular event that has sparked the plunging of the Euro, the combination of a multiple of things has driven its downfall. Hence, the events include Russian gas deliveries for June which was 40% shorter than expected, this has caused European gas prices to remain elevated. In addition, Nord stream is set to close completely for annual maintenance, where it shuts down completely during July 11-21st, the risk, however, is that the pipeline may not come back online. In addition European Central Bank (ECB) representative Nagel did little to help the Euro as he cautioned against using monetary policy to limit risk premia of indebted states, he also stated that an Anti-Fragmentation tool could only be used during exceptional circumstances. Although Bundesbank’s Nagel is part of the minority, this does raise the risk of a watered-down Anti-Frag tool, which has ultimately disappointed the market expectations. EUR/USD Price Chart Russia turns the gas taps off to a pipeline. The market is reflecting bearish signals for this currency pair. The Euro is on its backfoot against the pound sterling in the wake of surging Eurozone energy prices after Russia cut off the taps to a key pipeline. The Euro has been aggressively sold during the Tuesday trading day, starting from 8am London time. This is putting pressure on the Euro. EUR/GBP Price Chart Strikes in the UK began on Tuesday The market is reflecting bearish signals for this currency pair. Strikes in the UK over salaries began on Tuesday and could cut the country's gas output by almost a quarter and could exacerbate supply shortages in the wake of the war in the Ukraine. There is a possibility that around 15% of Norway's oil output could also be cut by Saturday, this is according to a Reuters calculation and is based on the plans of union members to gradually escalate their action over the coming days. Amidst these facts, the US Dollar remains strong. GBP/USD Price Chart GBP/AUD The pound sterling to Australian Dollar currency pair has been volatile, but may still struggle to rise if the US Dollar doesn't hold onto its Tuesday highs in the coming days. The AUD tumbled before most of its currency counterparts on Tuesday in the wake of the Reserve Bank of Australia (RBA) July policy decision, which saw the cash rate lifted by 0.5% for a second time, taking it up to 1.35% for the time being. Despite this move, the decision was widely expected by the markets, however, the statement that came with the policy decision indicated to the markets that the hawkish rhetoric from the RBA was lacking. GBP/AUD Price Chart Sources: finance.yahoo.com, poundsterlinglive.com, dailyfx.com
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Pound Sterling Offered Support After News That Boris Johnson Is Set To Step Down (EUR/GBP, GBP/USD), FED FOMC Meeting Minutes (EUR/USD), Japan’s Upper House Elections (USD/JPY)

Rebecca Duthie Rebecca Duthie 07.07.2022 16:36
Summary: ECB and FOMC meeting minutes release. UK Prime Minister set to step down. GBP is little changed. Japan’s upper house elections. Read next: Bearish Outlook For The EUR/USD Currency Pair, Euro & GBP Are Only Two Currencies Dominated By The US Dollar’s Strength (EUR/GBP, USD/JPY, EUR/JPY)  ECB & Fed FOMC meeting minutes. The market is reflecting bearish signals for this currency pair. The Euro has been under big pressure in the wake of global recessionary fears gripping the markets and causing its price to break below multi-decade lows. Earlier in Thursday's trading day, the Euro had managed to recover from some of the lows seen on Wednesday after the Federal Reserve's FOMC meeting minutes were released. Later on Thursday the meeting minutes of the last European Central Bank (ECB) meeting are due to be released and almost any hawkish rhetoric could benefit the Euro. EUR/USD Price Chart Boris Johnson set to step down The market is reflecting mixed signals for this currency pair. Boris Johnson is set to resign in the wake of many high-profile resignations within his government in protest of Boris Johnson’s continuing leadership, the current Prime Minister is set to address the media later on Thursday. This news has aided the EUR/GBP currency pair in its downward momentum. In addition, the Euro itself isn’t faring well amidst economic concerns, the potential for widening periphery bond spreads as the European Central Bank raises rates, and ofcourse the possibility of complications in restoring Russian gas inflows to Germany via Nord Stream 1 which is also due to undergo routine maintenance from next Monday until the 21st July. EUR/GBP Price Chart Strong US Dollar. The market is reflecting mixed signals for this currency pair. The US Dollar continues to strengthen in the wake of the Fed FOMC meeting minutes released late on Wednesday, and the continuing hawkish rhetoric. The GBP is little changed in most corresponding currency pairs. GBP/USD Price Chart Rising cost-of-living in Japan The market is reflecting bullish sentiment for this currency pair. The rising cost-of-living in Japan continues to squeeze domestic households' income ahead of Japan's upper house election on Sunday. The release of the Fed's FOMC meeting minutes has offered the US Dollar more support on Thursday whilst inflation is currently showing signs of becoming more politically based in Japan in the wake of the continuing cost-of-living squeeze. USD/JPY Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com  
Market Trends and Currency Positioning: USD Net Short Position, Euro and Pound Analysis - 22.08.2023

EUR/USD Attempts Parity (EUR/USD), Noord Stream Maintenance Is Underway (EUR/GBP), BoC Policy Decision Due Wednesday (GBP/CAD), USD/JPY

Rebecca Duthie Rebecca Duthie 11.07.2022 16:42
Summary: The Euro continues to be one of the more susceptible currencies as many headwinds build up. Will Russia resume gas supply to Noord Stream? Will the BoC policy decision offer CAD support? BoJ would do whatever is necessary to help the economy grow. Read next: Recession Fears Are Affecting Brent Crude Prices, Silver Price vs A Hawkish Federal Reserve, Corn At 8-Week Highs  US Dollar continues to strengthen across the board The market is reflecting mixed signals for this currency pair. On Monday the Noord Stream, Germany’s biggest pipeline closed for annual maintenance until the 21st July. The maintenance time period has increased speculation on whether or not Russia will resume gas flows after the maintenance has been completed. The Euro continues to be one of the more susceptible currencies as many headwinds build up. The European Central Bank (ECB) is still on track to raise interest rates (at least 25 bps) at their next meeting later on in July. The US Dollar continues to rise across the board, and investor attention will be aimed in the direction of the US CPI inflation data release for June on Wednesday. EUR/USD Price Chart   EUR/GBP mixed sentiment The market is reflecting mixed signals for this currency pair. The pound sterling will continue to be affected by external events whilst politics grabs headlines. The Euro continues to be negatively affected by a combination of events. One of the main events being whether or not Russia will turn the taps back on for gas supplies through the Noord Stream once the maintenance is over, if they do not, the possibility of a recession in the Euro area will increase largely. EUR/GBP Price Chart GBP/CAD hovers around 10-year lows The markets are keeping alert as they await the Bank of Canada’s (BoC) policy decision on Wednesday. Although the GBP/CAD currency pair hovers near 10 year lows, both currencies remained little changed on Monday and were both middle-of-the road performers amongst major currencies. GBP/CAD Price Chart BoJ representative speaks The market is reflecting mixed sentiment for this currency pair. A Bank of Japan (BoJ) representative warned the market that the current economic outlook remains uncertain due to the rising commodity prices and that the BoJ would do whatever is necessary to help the economy grow. The same representative also said that Japan’s financial system is robust, the economy is starting to improve and that the central bank would keep interest rates stable at the current or lower levels. USD/JPY Price Chart Sources: finance.yahoo.com, dailyfx.com, poundsterlinglive.com

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