Forex news from the European trading session - 14 June 2018

Headlines:

Markets:

  • GBP leads on the day, AUD lags behind
  • European equities lower on the day
  • Gold up by 0.45% to $1,305.19
  • WTI up by 0.21% to $66.78
  • US 10-year yields down by 2 bps to 2.946%
  • Bitcoin up by 3.46% to $6,476

The session started off with the dollar and aussie on the back foot, and pretty much stayed that way as markets focus their attention to the ECB meeting that is to come later.

The only notable event on the session was the release of UK May retail sales figures - which were a strong beat relative to estimates - and that pushed the pound higher before giving back some of those gains as we see now.

EUR/USD started the session around the 1.1800 handle, and slowly made its way towards a session high of 1.1831 before tailing off a little but continues to trade near the highs. The move owed a lot more to the dollar's weakness on the day than it does to positioning ahead of the ECB meeting.

USD/JPY meanwhile traded around the 110.00 figure level early on, and continued to hug said level as the yen gained as equities stumble and Treasury yields fall on the day. With large expiries anchoring the pair at 110.00, I expect more of the same until they roll off at 1400 GMT at the very least.

Cable on the other hand saw decent action as the pair rose to 1.3410 levels before the retail sales figures were released, and then jumped to a high of 1.3440 once the data was out. The high touched 1.3447, but subsequently the pair made its way back lower as essentially it is not enough to change the BOE rhetoric as mentioned here.

Other major currencies were more straightforward in their trading with USD/CHF and USD/CAD inching lower on the back of dollar weakness on the day. Meanwhile, NZD/USD made its way up against said dollar backdrop along with cross-buying against the aussie.

The AUD was marked down in the Asian session on poor Chinese data, but the move today was very much amplified by selling against the kiwi as well. Apart from that, yields aren't really helping the aussie's cause as well with 10-year yields falling by 6 bps today - pushing the US-Australia yields spread to 22 bps in the US' favour now, up from 18 bps yesterday.