The G-10 rundown
USD – the US dollar continues to grind stronger and risks maintaining this tendency until something is done to stop it by the Trump administration or the Fed, though the risk is that the Fed only reacts rather than pulls itself ahead of the curve.
EUR – the euro remains heavy and looks set to at least test the lows for the cycle and 1.1000, even if all new lows over the last year – and there have been several – never yielded to a major or even minor extension.
JPY – price action in USDJPY seems to be mimicking equity indices a bit more closely of late – interesting to see that both USDJPY and major US equity markets at key local resistance heading into next week’s heavy calendar.
GBP – sterling looks resilient here despite the uncertainty. No deal Brexit opposition trying to gel across parties in a gambit to skirt Boris Johnson’s attempt to go it alone in negotiation with the EU, but their efforts face many hurdles.
CHF – EURCHF pushing at local resistance, possibly on the Italian political news as the awkward new coalition looks set to avoid elections that would have seen a Lega-led troublemaker for the EU in power.
AUD – the Aussie trades heavily after ugly 28.5% drop YoY in Building Approvals in July. Only a small minority believe that the RBA cuts next Tuesday – possibly fair given that the weak AUD is doing the heavy lifting at the moment – AU Q2 GDP up next Wednesday.
CAD – a pivotal week ahead for CAD as we await data and the Bank of Canada next Wednesday for a sense of whether the market is correct in assessing 30%+ odds that the Bank of Canada remains unchanged on its 1.75% policy rate through the December BoC meeting. Pivotal zone is 1.3300-25
NZD – AUDNZD bulls in good shape – big test next week with AU data and RBA Tuesday. NZDUSD looking near the big lows soon in 2015 below 0.6250.
SEK and NOK – plumbing new depths for the cycle versus the US dollar and EURNOK is slipping its grip on 10.00, while the Riksbank has a tall task in bringing any relief to SEK at next Thursday’s Riksbank meeting.
Upcoming Economic Calendar Highlights (all times GMT)
- 0830 – UK Jul. Consumer Credit
- 0830 – UK Jul. Mortgage Approvals
- 0900 – Euro Zone CPI Estimate
- 1230 – Canada Jun. (&Q2) GDP
- 1230 – US Jul. PCE Inflation