Forex news from the European morning session 12 May 2015

News:

  • Fed's Dudley says interest rate lift-off should not be a big surprise when it occurs
  • IMF says it doesn't want to take part in a new Greek bailout
  • Germany's Schaeuble says improvement in Greek talks climate not matched by substance
  • French fin min Sapin every week becomes more precious for Greek accord
  • UK to hold referendum on EU membership regardless of negotiation outcome
  • Japan's LDP draft proposal says fiscal condition will worsen when BOJ tries to exit QQE
  • Australian budget: Cuts growth to 2.75% from 3.0% for 2015/16
  • Latest OECD leading indicators point to stronger Eurozone growth
  • EURUSD triggers stops through 1.1200 as Dudley casts doubt on rate hike timing
  • GBPUSD still on a roll as 1.5700 is the latest fence to fall
  • Another earthquake hits Nepal, magnitude 7.4
  • Option expiries 10am NY cut today 12 May

Data:

  • March 2015 UK industrial production 0.5% vs 0.0% exp m/m
  • Bank of France business climate indicator industrial sector April 98 vs 97 prev
  • Japan leading index CI March prov 105.5 vs 105.5 exp
  • Nikkei 225 closes up 0.02% at 19,624.84

Yesterday's euro selling has been today's fish and chip wrapping paper as buyers flock back and the pound, after a shy start, is more than happy to join in the party after stronger production data

The euro was finding a few early buyers but then EURUSD had a ramp up through 1.1200 triggering stops to 1.1232 before then going again taking out decent corp offers at 1.1250 as Fed's Dudley cast doubts on an early US rate hike. EUGBP enjoyed the ride to 0.7227 from 0.7175 and EURJPY to 13530.

EURUSD was stalling around highs of 1.1279 when better than expected UK data gave the pound a timely boost, wiping its feet at 1.5600 briefly before taking out offers at 1.5625 and 1.5650. This sent EURGBP back down through 0.7200 after some stubborn resistance with EURUSD holding its own around 1.1250 and we've now gone back to where we started with cable taking out offers at 1.5700 to post 1.5711

So, euro and pound gains overall and we've also seen CHF find some love on the softer greenback sentiment with USDCHF falling to 0.9211 from 0.9331 outpacing the EURUSD rise as EURCHF fell to 1.0385 from 1.0435.

USDJPY started perkily enough as Nikkei staged a late rally to send the pair up to 120.28 from 120.10 but we were in retreat again on the USD selling although tempered by EURJPY buying

USDCAD has drifted off to 1.2024 from 1.2100 helped by firmer oil but it's finding buyers on each dip while AUDUSD finally had a look at 0.8000 late in the session after spending most of it between 0.7925-55. NZDUSD rallied to 0.7402 before retreating as AUDNZD buyers came to the fore.

Busy times again, with Greece still in the headlines but the market seems to have a different agenda today