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Today’s morning London session was relatively quiet, likely because traders were getting ready for the upcoming U.S. GDP report.

However, that doesn’t mean that there was no action whatsoever since the Greenback was bid higher across the board ahead of the GDP report. The Swissy, meanwhile, encountered selling pressure, likely because of the risk-on vibes in Europe.

Aside from those two, the pound is also worth noting since it was the second best-performing currency of the session despite the lack of catalysts.

  • French flash Q2 GDP q/q: 0.2% vs. 0.3% expected, 0.2% previous
  • German import prices m/m: 0.5% vs. 0.3% expected, 1.6% previous
  • French consumer spending 0.1% vs. 0.6% expected, 1.0% previous
  • Spanish retail sales y/y: 0.1% vs. -0.1% previous
  • U.S. Q2 GDP report coming up

Major Events/Reports:

Commodities fall

Commodities were broadly in the red during the morning London session. And we can probably blame the stronger Greenback for that since a stronger U.S. dollar makes globally-traded commodities relatively more expensive for market players holding non-USD currencies.

And for reference, the U.S. dollar index was up by 0.12% to 94.68 for the day by the end of the morning London session. And as noted in the introduction, the Greenback was also the top-performing currency of the session.

Other than Greenback strength, it’s also possible that commodities were under pressure because of profit-taking. After all most commodities (except precious metals) had a good run this week because of easing trade-related tensions among other factors.

Base metals were actually mixed, but most were in the red.

  • Copper was down by 0.35% to $2.808 per pound
  • Zinc was down by 0.81% to $2,568.25 per dry metric ton

Oil benchmarks were leaking red, but off the day’s lows.

  • U.S. WTI crude oil was down by 0.32% to $69.39 per barrel
  • Brent crude oil was down by 0.27% to $74.34 per barrel

Precious metals got hammered.

  • Gold was down by 0.63% to $1,218.00 per troy ounce
  • Silver was down by 0.87% to $15.360 per troy ounce

Risk-taking to end the week

Risk-taking has been the dominant sentiment in Europe during the past few days.

And risk-taking is still the dominant sentiment in Europe since the major European equity indices extended their gains today, with some reaching six-week highs.

And according to market analysts, today’s bout of risk-taking was sustained by positive earnings reports and easing trade-related fears due to the meeting of the minds between U.S. President Trump and European Commission President Jean-Claude Juncker.

  • The pan-European FTSEurofirst 300 was up by 0.38% to 1,535.08
  • Germany’s DAX was up by 0.41% to 12,858.62
  • The blue-chip Euro Stoxx 50 was up by 0.52% to 3,527.05

U.S. equity futures were also bouyed by the risk-friendly vibes in Europe, but that may change since the U.S. GDP report is coming up.

  • S&P 500 futures were up by 0.10% to 2,845.00
  • Nasdaq futures were up by 0.37% to 7,458.50

Major Market Mover(s):

USD

The Greenback was the best-performing currency of the morning London session, extending its gains from yesterday.

There were no direct catalysts for the Greenback’s strength, but market analysts pointed to possible speculation that the U.S. Q2 GDP report may surprise to the upside.

EUR/USD was down by 21 pips (-0.18%) to 1.1626, AUD/USD was down by 13 pips (-0.17%) to 0.7374, NZD/USD was down by 14 pips (-0.20%) to 0.6768

CHF

The Swissy was hit by sellers and was the worst-performing currency of the session, likely because of the risk-on vibes. Although intervention by the sneaky SNB is always a possibility, especially after yesterday’s rise.

USD/CHF was up by 23 pips (+0.23%) to 0.9972, EUR/CHF was up by 8 pips (+0.07%) to 1.1595, GBP/CHF was up by 28 pips (+0.22%) to 1.3057

GBP

The pound was the second top-performing currency of the session. There were no apparent catalysts, but it’s possible that we’re just seeing some short covering by GBP bears after the pound got whupped when Michel Barnier rejected Theresa May’s proposals yesterday.

GBP/JPY was up by 19 pips (+0.13%) to 145.57, GBP/AUD was up by 32 pips (+0.18%) to 1.7755, GBP/NZD was up by 39 pips (+0.20%) to 1.9345

Watch Out For:

  • 12:30 pm GMT: U.S. advanced Q2 GDP estimate (4.3% expected vs. 2.0% previous) and GDP price index (2.3% expected vs. 2.2% previous); read Forex Gump’s Event Preview
  • 2:00 pm GMT: University of Michigan’s revised consumer sentiment index (no change from 97.1 expected)