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The forex calendar for today’s morning London session was empty. Even so, there was price action aplenty since the euro and the Swissy strapped on some booster rockets and soared over their peers.

And while risk aversion soured during the session, the Kiwi continued to grind higher against most of its peers, which is both weird and interesting. The Greenback, meanwhile, gave back its gains from the earlier session and ended up as the worst-performing currency of the session.

  • No major economic reports were released during the session

Major Events/Reports

Mama Merkel spricht

German Chancellor Angela Merkel gave a speech to German students in Berlin earlier. And during the Q&A portion, Merkel said the following bit (emphasis mine):

The euro is too weak — that’s because of ECB policy — and so German products are cheap in relative terms.”

Merkel was also asked about her foreign policy, particularly with regard to France. And she replied by saying that Macron’s win was supposedly an “extraordinary event in French politics.” Merkel then added that Germany “will have to help Macron so he’s successful.”

Commodities climb

Commodities staged a broad-based rally during today’s morning London session after a mixed performance during the earlier Asian session.

Oil benchmarks extended their gains.

  • U.S. WTI crude oil was up by 0.93% to $51.14 per barrel
  • Brent crude oil was up by 0.95% to $54.12 per barrel

Base metals were in the green.

  • Copper was up by 0.17% to $2.586 per pound
  • Nickel was up by 0.69% to $9,422.50 per dry metric ton

Precious metals also got some love.

  • Gold was up by 0.21% to $1,256.18 per troy ounce
  • Silver was up by 1.02% to $16.968 per troy ounce

The Greenback erased its earlier gains and was mostly down during the session. And the Greenback’s weakness may have helped to entice buyers to jump in. And for reference, the U.S. dollar index was down by 0.11% to 96.89 for the day after printing gains earlier.

Other than that, market analysts can’t really explain the broad-based rally. They do have explanations for each commodity type, though. Precious metals, for example, were in demand because of the risk-off vibes in Europe.

Meanwhile, base metals, particularly zinc and nickel, got a boost from tighter supply because of China’s crackdown on Chinese steel mills, market analysts say.

As for oil’s strong performance, market analysts are still pointing to speculation that OPEC will extend its oil cut deal (and possibly introduce deeper cuts).

Risk aversion returns

The appetite for risk from the earlier Asian session initially caused European equities to print some gains as well. However, it soon became clear that risk aversion was slowly creeping back in, since European equity indices slowly turned negative one after the other.

  • The pan-European FTSEurofirst 300 was down by 0.19% to 1,536.21
  • Germany’s DAX was down by 0.40% to 12,588.50
  • The blue-chip Euro Stoxx 50 was down by 0.24% to 3,577.50

Market analysts blamed the returning risk-off vibes on political uncertainty in Spain after the Spanish Socialist Party elected former head and hardliner Pedro Sanchez as its new leader. This development, market analysts say, would make it harder for the Conservative Party to muster opposition support.

Major Market Mover(s):


The euro and the Swissy continued last week’s theme by blasting off during the morning London session. Interestingly enough, the euro and the Swissy were both mostly in retreat earlier before shooting higher. And the apparent trigger for the euro rally was Merkel’s statement about the euro being too weak, as well as her readiness to help new French President Macron.

As for the Swissy’s rally, that was likely due to the risk-off vibes during the session. But as I’ve been pointing out since my recap for the April 24-28 trading week, the Swissy appears to be tracking the euro again. And that also appears to be the case again, since the Swissy jumped higher when the euro jumped higher because of Merkel’s statement.

EUR/USD was up by 63 pips (+0.56%) to 1.1233, EUR/JPY was up by 62 pips (+0.50%) to 125.14, EUR/AUD was up by 31 pips (+0.21%) to 1.5043

CAD/CHF was down by 15 pips (-0.21%) to 0.7192, AUD/CHF was down by 12 pips (-0.16%) to 0.7249, GBP/CHF was down by 43 pips (-0.34%) to 1.2629


All eyes were on the euro and the Swissy during today’s morning London session. However, it’s also worth noting that the Kiwi extended its gains (except against CHF & EUR of course) during the session and was the third-best performing currency. Aside from the commodities rally, there’s really nothing else that could have sustained demand for the Kiwi. And just as interesting (but a little weird) is that the Aussie failed to follow suit and was more mixed for the session.

NZD/USD was up by 36 pips (+0.51%) to 0.6972, NZD/JPY was up by 42 pips (+0.55%) to 77.67, NZD/CAD was up by 26 pips (+0.28%) to 0.9411


The Greenback gave back most of its gains from the earlier Asian session and ended up as the worst-performing currency of the morning London session. There was no apparent catalyst, however, unless Trump-related worries are still weighing down on the Greenback.

USD/JPY was down by 10 pips (-0.10%) to 111.38, USD/CAD was down by 29 pips (-0.22%) to 1.3496, USD/CHF was down by 39 pips (-0.40%) to 0.9709

Watch Out For:

  • 1:00 pm GMT: CB’s leading Chinese index (0.9% previous)
  • 2:00 pm GMT: Philadelphia Fed President Patrick Harker will speak
  • 2:30 pm GMT: CB’s U.S. leading index (0.4% previous)
  • 2:30 pm GMT: Minneapolis Fed President Neel Kashkari has a speech
  • 5:30 pm GMT: RBA Assist Governor Debelle will speak
  • 6:00 pm GMT: U.K. Prime Minister Theresa May will be interviewed
  • Victoria Day holiday in Canada