Dollar holds firm ahead of European markets open
The greenback leads the way ahead of European trading
The dollar is sitting firmer on the day as it continues to advance against the likes of the euro and pound, with the former pushing further below the 1.1000 handle on the week.
Brexit pain continues to pose a major problem for the pound and it is also in part weighing on the single currency but all of this just bolsters flows into the dollar and the yen overall.
Commodity currencies remain somewhat weaker as well with the aussie recovering some ground as the RBA left its cash rate unchanged at 1.00% earlier, though reiterating that future rate cuts are still on the table.
Overall, the move today is telling that the macro backdrop suggests that the dollar remains "the cleanest shirt in a dirty pile" but I'd be wary of that sentiment should economic conditions in the US deteriorate substantially over the coming months.
Markets are sending a bit of a mixed message today with US futures lower (E-minis down 0.5%) but Treasury yields are holding higher, keeping USD/JPY elevated at 106.30.
If anything else, I reckon we will start to see more of a softer touch in risk given the current market landscape so that could potentially exacerbate the flows we're seeing so far today in currencies as well.
Looking ahead, Brexit headlines look set to dominate European trading so pay attention to happenings in Westminster as well as the overall risk mood to dictate trading sentiment in the day ahead.