- Chinese stocks rebound. Senior Chinese central banker says PBOC will “unswervingly” stick to appropriately loose monetary policy
- UK July Nationwide house price index +1.3% m/m, -6.2% y/y. Smallest y/y fall since June 2008. Nationwide feel house prices could end year higher than where they started
- German July s.a jobless total falls -6,000 m/m due to one-off effects. Without them jobless total would have risen +30,000, still better than median forecast of +45,000. Unemployment rate 8.3% compared to median forecast of 8.4%
- Euro zone July economic sentiment up at 76.0 from 73.2 in June, better than median forecast of 75.0
Risk appetite in better shape today, benefitting likes of euro, sterling, aussie and canadian dollars at the expense of US dollar, yen and swissy. Stocks, oil etc up.
Chinese stocks rebounded today, and general risk appetite lifted, when Chinese authorities indicated they will be sticking with appropriately loose monetary policy.
The main european data out today (see above) also made generally encouraging reading.
EUR/USD started out around 1.4055 and has been up to a 1.4094 session high, unable so far to take out well-documented sell orders at 1.4090/oo. EUR/GBP has been under heavy pressure and this will have helped negate a break through 1.4100. The cross is down at .8530 from an early .8580, slightly off session low .8516.
China was seen buying EUR/USD overnight around session low 1.4009.
Cable has had a good morning. It was on the move early, bolstered by the improved risk appetite. Having started out around 1.6380, it moved over 1.6400 very early and then got a further boost from stronger than expected Nationwide housing data (see above.)
However, reported sell orders in the 1.6450/70 area threatened to thwart the rally. That was until a large US custody bank stepped in buying aggressively, taking out the offers and triggering stops just above 70.
Cable then got a further lift when better than expected euro zone sentiment data (see above) lifted risk appetite further and the pairing posted a session high 1.6526. However as we’ve seen on many ocassions of late, cable has struggled to hold the ground above 1.6500 and we’re presently back down at 1.6495.
USD/JPY has ticked higher, presently up at 95.10 from an early 94.90, the JPYgenerally weaker against the backdrop of raised risk appetite. Sources now note sell orders lined up at 95.25 up through 95.50. Japanese exporters, option players defending 95.50 barrier option interest mentioned, China by name.
EUR/CHF has moved higher against the backdrop of raised risk appetite, presently up at 1.5305 from an early 1.5265. Comments from SNB’s Jordan yesterday, reiterating the bank’s unflinching determination to halt swissy strength against the euro, has also served to underpin the cross.
