FX Brief: Trump Accuses China Of Devaluing Their Currency (Again)
Matt Simpson July 8, 2019 12:11 AM
A summary of news and snapshot of moves from today’s Asia session.
FX markets remain confined within tight ranges, following Friday’s volatile US session. CHF and AUD are currently the strongest majors, EUR and USD are the weakest. The USD pared some gains from its NFP-driven strength.
- Equities were mostly lower as Friday’s strong NFP reduced expectations of the Fed cutting by 50bps later this month.
- ECB’s Villeroy said their next move will be decided by data, not the markets, in an interview released today.
- Trump (not for the first time) claimed China is devaluing their currency whilst speaking with reporters. He also said the Fed would lower rates if they knew what they were doing.
- On the data front, Japan’s machinery orders fell -7.8% in May, its fastest monthly decline since September. Bank lending also eased off to 2.3% YoY (2.6% prior). The Nikkei is currently trading at a 6-day low.
- Germany’s industrial output will be on the radar for EUR traders, after it fell -1.9% in May, its fastest rate of contraction since August 2014 (especially in light of Villeroy’s comment). With expectation for data to improve, it leaves potential for disappointment and a weaker Euro if it misses the mark.
- CFTC data will also be released in the US session, which has been delayed due to the US public holiday last week (so expect our weekly COT report to follow).
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.