Narrow trading ranges prevail on the day so far
There isn't much to shake things up on the day as major currencies are seen trading tepidly for the most part. Trump made some optimistic comments earlier on trade which helped to boost risk sentiment in general and helped the aussie and kiwi move to session highs of 0.7214 and 0.6900 against the dollar respectively. However, some of those gains have since been pared as we await European traders to enter the fray.
The improved risk sentiment sees E-minis trade around 0.7% higher currently and Treasury yields are also higher on the day as well. That's helping to keep yen pairs slightly bid at the moment.
Meanwhile, the loonie is having a decent start to the day as the better risk tones and a move higher in oil is helping to support the currency. Oil got a boost as private survey data showed a larger-than-expected drawdown in crude inventories.
All eyes will now turn towards the UK as we await on further developments to see if a leadership challenge will be mounted against Theresa May later today as the 48 letters needed to table a no confidence motion was reportedly reached overnight. That will continue to inject further volatility in the pound as we navigate through the day ahead. For some context, 1-month sterling implied volatility continues to hold at its highest levels since July 2016 currently:
Here are the trading ranges for dollar pairs so far today:
- EUR/USD - 18 pips
- USD/JPY - 21 pips
- GBP/USD - 33 pips
- USD/CHF - 14 pips
- USD/CAD - 27 pips
- AUD/USD - 33 pips
- NZD/USD - 28 pips
