FX Brief: EUR Lower as Investor Pessimism Grows
Fawad Razaqzada July 8, 2019 7:43 AM
- FX volumes have remained lower than usual with no major US data scheduled for release in the afternoon. FWIW, the AUD was the strongest and EUR the weakest at the time of writing, with the latter hurt by growing investor pessimism. Equities were mostly lower as Friday’s strong NFP reduced expectations of the Fed cutting by 50bpslater this month.
- In EM FX news, (1) Trump again claimed China is devaluing its currency whilst speaking with reporters and (2) the Turkish lira has dropped amid renewed concerns that President Recep Tayyip Erdogan is ruining the nation’s economy, just as inflation was starting to ease back, with his decision to replace the Turkish Central Bank’s Governor over the weekend.
- Sentix Investor Confidence deteriorated to -5.8 from -3.3 last month, disappointing forecasts of an improvement to +0.3. A reading below zero points to pessimism while above means optimism. Investors have therefore grown increasingly pessimistic about the relative 6-month economic outlook for the Eurozone. However, there was some good news from Germany, for a change. German exports were up 1.1% in May after dropping 3.4% in April, while industrial production rose 0.3% after a 2% fall in April. Both figures were roughly in line with economists' forecasts. This follows data on Friday showing factory orders in Europe's biggest economy dropped 2.2% in May.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.