London Session Forex Recap – Mar. 10, 2015

  • Swiss Unemployment: 3.2% vs. 3.2% forecast, 3.1% previous
  • French Industrial Production m/m: 0.4% vs. -0.3% forecast, 1.5% previous
  • French Manufacturing Production m/m: -0.1% vs. 0.1% forecast, 1.2% previous

High-yielding currencies are on the down swing and the Japanese yen is rallying, likely on a combination of several stories from the Asia and morning London session: mixed inflation out of China brings questions of whether support is needed, and talks between Greece and its creditors looking shaky at the moment.  With both stories combined, it’s forex traders a bit scared on the session, with many selling out of risk and jumping into the “safe havens” like the U.S. dollar and Japanese yen.  Both currencies had a very strong rally against the majors in early European trade, with momentum still in its favor going into U.S. trade:

GBP/JPY is down 56 pips (-0.31%) to 182.69, USD/JPY is up 22 pips (+0.18%) to 121.36, and AUD/JPY is down 60 pips (-0.65%) to 92.69

With comments from the Greek finance minister suggesting that Greece is unlikely to pay its debts coming out today, the euro continue its slide, a new leg lower sparked by the start of the ECB quantitative easing program yesterday.  The shared currency is down across the board an likely to remain under pressure for the session:

EUR/USD is down 106 pips (-0.98%) to 1.0742, EUR/GBP is down 34 pips (-0.47%) to .7137, and EUR/JPY is down 103 pips (-0.79%) to 130.38

The forex calendar for the Tuesday afternoon London/morning U.S. session is another light one with a couple of U.S. economic data points in the lineup.

At 2:00 pm GMT, we’ll get the monthly U.S. wholesale inventories number (-0.1% forecast vs. 0.1% previous) and the Job Openings and Labor Turnover Survey (JOLTS) data from the Bureau of Labor Statistics (BLS).  Both are in the low-to-mid tier range of importance to forex traders, so it’s not likely we’ll see currency volatility will pick up on these releases without a huge surprise.  Traders are likely to continue to focus on the market movers from China and Europe today, as well as continue to price in a potential Fed rate hike, with speculation pointing to as early as summer for the Fed to make a move. With everything going on across the globe, forex volatility is likely to remain elevated for the session…Stay frosty!

See also:

Asia Session Recap

U.S. Session Recap

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