Article Highlights

  • Japan flash manufacturing PMI down to 50.2 vs. 52.0 expected, 52.3 previous
  • New Zealand credit card spending (y/y) up by 8.9% vs. 7.4% last month
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Risk aversion reigned supreme in the forex markets, as Asian session traders extended yesterday’s themes and price action.

Major Events:

Overall risk appetite – Market players went to work hungry for gains today, as investments like commodities and high-yielding currencies saw green figures across the board. Analysts point to profit-taking from last week’s losses as possible catalyst for today’s optimistic mood.

Brexit headlines – The pound moved to the beat of Brexit headlines today, gapping lower over the weekend against its counterparts on the increased possibility of the U.K. breaking away from the Euro Zone. Word around the hood is that London Mayor Boris Johnson is on board with the plan. Will this spell more uncertainty for the British pound in the next trading sessions?

BOJ’s Kuroda tries to jawbone – The low-yielding yen got hammered by its higher-yielding counterparts on the back of a generally risk-friendly trading environment. It might have also helped that BOJ Governor Kuroda tried to talk down the yen by citing lower oil prices and uncertainty over China’s markets as possible reasons why the BOJ is still planning on pushing the pedal to the metal to boost the country’s inflation.

Major Currency Movers:

GBP – Thanks to Brexit headlines, the pound pairs saw weekend gaps across the board.

GBP/USD jumped down from 1.4361 to open at 1.4254 while GBP/JPY fell from 161.65 to 160.55 before settling up to 161.25. Even EUR/GBP jumped from its .7753 close to open at .7799 before dropping back down to .7780.

Comdolls – Commodity-related currencies like the Aussie, Loonie, and Kiwi got a boost from overall risk appetite and improvements in commodity prices.

AUD/USD inched 17 pips higher (+0.24%), USD/CAD slipped by 18 pips (-0.13%), and NZD/USD popped up by 12 pips (+0.18%).

Watch Out For:

  • 8:00 am GMT: French flash manufacturing and services PMIs
  • 8:15 am GMT: Switzerland PPI expected to print at -0.2% vs. -0.4% previous
  • 8:30 am GMT: German flash manufacturing and services PMIs
  • 9:00 am GMT: Euro Zone flash manufacturing and services PMIs
  • 11:00 am GMT: U.K. CBI industrial order expectations

See more:

U.S. Session Forex Recap

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