U.S. Session Forex Recap – June 17, 2016

  • U.K. Minister of Parliament Jo Cox fatally shot
  • EU Brexit campaigns temporarily suspended
  • U.S. headline CPI at 0.2% vs. 0.3% forecast
  • U.S. core CPI unchanged at 0.2% as expected
  • Philly Fed manufacturing index up from -1.8 to +4.7 vs. +1.1 forecast
  • U.S. initial jobless claims up 277K vs. 267K consensus

Risk appetite made a comeback a few hours into the U.S. trading session due to a surprise turn of events surrounding the Brexit campaign.

Major Events:

Anti-Brexit U.K. MP assassinated – U.K. Prime Minister David Cameron decided to temporarily suspend campaigning for the EU referendum after anti-Brexit Minister of Parliament Jo Cox was fatally shot and stabbed. The attacker was said to have yelled “Britain first!” before pulling the trigger, stirring fear among both “leave” and “remain” camps.

Because of that, rumors swirled that the actual EU referendum might be postponed, although there has been no confirmation from any of the U.K. authorities just yet. For some, this tragic incident might sway undecided voters to choose the safer option, which is to stay in the EU.

U.S. economic reports – Data from the U.S. came in mixed, with the initial jobless claims up 277K versus the projected 267K reading and the Philly Fed manufacturing index beating expectations by rising from -1.8 to +4.7 to indicate a return to industry expansion. Inflation reports came in close to consensus, as the headline CPI landed at 0.2% versus the 0.3% forecast while the core version of the report was unchanged at 0.2%.

Major Currency Movers:

JPY – Rally and reverse! The yen returned its gains from earlier in the day as risk appetite seemed to pick up in the New York session.

USD/JPY bounced off a session low of 103.76 up to 104.85, EUR/JPY retreated from a low of 115.50 back to the 118.00 handle, AUD/JPY reversed upon hitting a low of 75.60 up to a high of 77.50, and CAD/JPY is back above the 81.00 mark.

GBP – Talks of a possible suspension of the actual EU referendum owing to MP Jo Cox’s death allowed the pound to breathe a sigh of relief, but there has been no official announcement yet.

GBP/USD found support at 1.4100 and jumped to a high of 1.4275, GBP/JPY hit a low of 145.40 before turning on its heels and racing to 149.50, EUR/GBP found resistance at .7994 and is down to .7900.

See also:

Asian Session Recap

London Session Recap

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