London Session Forex Recap – June 19, 2015

  • German PPI y/y: -1.3% actual v.s. -1.1% expected, -1.5% previous
  • German PPI m/m: 0.0% actual v.s. 0.2% expected, 0.1% previous
  • Euro Zone Current Account: 22.3B actual v.s. 18.0B previous
  • U.K. Public Borrowing: 10.1B actual v.s. 10.3B expected, 6.2B previous
  • Canadian CPI on tap

Today’s morning London session was rather subdued. Most currencies were mixed or flat for the forex session, but the euro was on the move to the downside, thanks to concerns over Greece and poor German data.

The euro started the session a bit soft when Germany posted deteriorating PPI readings, but the real fun (if you’re short on the euro) began when the rumor mills started churning out one report after another. Perhaps the most significant rumor was the one where the ECB will supposedly have an emergency meeting today with regard to the Emergency Liquidity Assistance (ELA) to Greece. Apparently, three “officials” have confirmed that they are planning to increase the ELA after rumors surfaced earlier that the ECB was planning to cut Greece off in case Greece defaults on its IMF loan. In other, more reliable news, European leaders are planning to have an emergency summit on Monday to try and avert a Greek default.

EUR/USD is down by 42 pips (-0.38%) to 1.1297, EUR/JPY is down by 49 pips (-0.36%) to 139.14, EUR/GBP is down by 17 pips (-0.25%) to 0.7130

As for other noteworthy currencies, there was the pound. The pound was noteworthy because it was slightly weak despite having the smallest budget deficit since 2007. There weren’t any negative catalysts to explain the pressure on Sterling, so it’s possible that forex traders were opting to sit on the sidelines or take profits on their long positions. Today’s a Friday after all and it’s good practice to avoid weekend event risk.

GBP/USD is down by 21 pips (-0.13%) to 1.5842, GBP/CAD is down by 8 pips (-0.05%) to 1.9397, GBP/JPY is down by 20 pips (-0.10%) to 195.07

Loonie traders better watch out because the forex calendar for the upcoming afternoon London/morning U.S. session is jam-packed with top-tier Canadian data.

Forex traders will get a data dump at 1:30 pm GMT, with the release of the Canadian headline (0.7% expected, 0.7% previous) and core (0.3% expected, 0.5% previous) retail sales data, as well as Canadian headline (0.5% expected, -0.1% previous) and core (0.3% expected, 0.1% previous) CPI readings.

While headline retail sales is expected to remain flat at 0.7%, the core retail sales data is expected to decline, so get ready for some Loonie weakness if the actual readings are within expectations or worse. On a more upbeat note, both headline and core CPI readings are expected to increase, so watch out if the actual readings are way off expectations.

As a bonus, Federal Reserve Bank of San Francisco President John Williams has a speech at the National Bureau of Economic Research. We probably won’t get any updates, but do keep an ear out just in case.

Stay frosty!

See also:

Asia Session Recap

U.S. Session Recap

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