The G-10 rundown
USD – the USD springing back in early European trading today – an important coincident indicator for risk appetite. More policy forthcoming – perhaps with the US Treasury joining in more forcefully – if the USD pulls back to the strong side.
EUR – concerns for the euro and Europe if the EU cant coordinate a more profound fiscal response even if ECB supporting strongly at the margin by having abandoned former rules on purchase allocations across the EU.
JPY – big questions for quarter and Japan financial year-end loom over the end of this month and with JPY crosses providing high beta to the swings in risk appetite. In more normal times, such low long US yields would be more JPY supportive.
GBP – the GBPUSD rally ran all the way to 1.2300 in this epic move off the bottom, but the move may need digestion. The UK government responding strongly on the virus now and has luxury of control over its own money printing!
CHF – the new dip in sentiment weighing on EURCHF again, but with SNB likely leaning against. Down the road – wondering how Switzerland deals with the aftermath of one of the world’s worst housing bubbles – the script could flip suddenly on the CHF down the road.
AUD – the Aussie rally extended all the way above 0.6100 before a sharp reversal this morning. If risk sentiment can’t stage a recovery, AUDUSD and AUDJPY could post an ugly daily candlestick today.
CAD – the correction all the way to 1.4000 looks overaggressive given the state of oil markets – this is perhaps the first pair to lean against for the USD to bounce back given the oil situation.
NZD – the kiwi back to outperforming the AUD as sentiment deteriorates, and the NZDUSD and NZDJPY moves off the lows were enormous and are up against important resistance on respective charts.
SEK – the 10.90-11.00 zone in EURSEK shaping up as the important pivots. Last nights weak EU meeting no help for the SEK, and the uniquely lax Swedish Covid19 policy response is a high stakes gamble.
NOK – the NOK recovery extended very far considering how weak crude oil prices remain. One support may be that increased fiscal response from Norway requires much larger NOK purchases.
Upcoming Economic Calendar Highlights (all times GMT)
- 1230 - US Mar. PCE Inflation
- 1400 - US Final Mar. University of Michigan Sentiment