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  • Germany, France, and Switzerland on Bank Holiday; no economic data releases
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Today’s morning London session had a practically empty forex calendar, but nonetheless, European currencies were making moves left and right with the euro, the Sterling, and the Swissy surging upwards.

The euro was on the war path again, losing out only to the Sterling and the Swissy. The euro’s recent strength has been linked primarily to a surge in euro zone bond yields. German 10-year bond yields, for example, are up by 0.032 (+4.44%) to 0.752 for the session. The recent Greenback weakness due to yesterday’s disappointing read for U.S. retail sales and import prices probably contributed as well, pushing traders out of U.S. assets and searching for security in other markets.

EUR/USD is up by 32 pips (+0.28%) to 1.1433, EUR/GBP is down by 4 pips (-0.06%) to 0.7234, EUR/CHF is down by 31 pips (-0.30%) to 1.0387

The pound gave the other currencies another round of pounding, taking back the losses sparked by yesterday’s Bank of England (BOE) inflation report caused the pound to stumble a bit. There were no other catalysts for the session, so it’s most likely just a continuation of the shift towards bullishness after the U.K. election uncertainty was lifted last week:

GBP/USD is up by 38 pips (+0.25%) to 1.5796, GBP/JPY is up by 80 pips (+0.42%) to 188.30, GBP/CAD is up by 69 pips (+0.37%) to 1.8874

The euro and the pound can move over because the true champion of today’s trading session is the mighty Swissy. There were no direct catalysts for the Swissy’s strength and Swiss traders and bankers are away on holiday so it’s most likely borrowed strength from the euro due to their close trade relations. And with uncertainty over the Greek debt crisis, investors seem to favor the Swissy over the euro.

USD/CHF is down by 50 pips (-0.58%) to 0.9080, NZD/CHF is down by 82 pips (-1.18%) to 0.6809, AUD/CHF is down by 64 pips (-0.87%) to 0.7354

The forex calendar for the Thursday afternoon London/morning U.S. session promises more volatility and trading opportunities, with top-tier and mid-tier data on tap.

We’ll start the session at 1:30 pm GMT as Canadian NHPI (0.2% expected, 0.2% previous), U.S. Producer Price Index (PPI) m/m (0.1% expected, 0.2% previous), U.S. core PPI m/m (0.1% expected, 0.2% previous), and U.S. jobless claims (272K expected, 265K previous) will be released.  The U.S. PPI number is the one to watch as inflation remains the key metric to central bank policies in this low inflation world we’re living in.

The rest of the session will only have a bunch of low-tier data on tap, but forex traders may see renewed volatility in the euro at 4:00 pm GMT when ECB President Mario Draghi speaks at the Michel Camdessus Central Banking Lecture sponsored by the International Monetary Fund. Maybe he will be singing a different tune with regard to his views? Keep your eyes and ears out just in case.

See also:

Asia Session Recap

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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