Forex news from the European trading session - 18 June 2018
Headlines:
- Bundesbank says German economy likely picked up pace in spring
- IMF says that SNB should keep monetary policy accommodative for now
- OPEC said to discuss oil output hike of 300k to 600k bpd
- Italy April total trade balance €2.94 bn vs €4.53 bn prior
- SNB total sight deposits w.e. 15 June CHF 576.5 bn vs CHF 576.3 bn prior
- Germany's Bouffier says can't expect EU migration deal in the next two weeks
- German economy expected to expand 2.1% in 2018 - survey
- Japan's Abe says difficult to restore fiscal health while still in deflation
Markets:
- CHF leads, GBP lags on the day
- European equities lower, DAX leads losses
- Gold up by 0.13% to $1,281.21
- WTI down by 0.57% to $64.69
- US 10-year yields down 1.1 bps to 2.909%
- Bitcoin down 0.95% to $6,436
The session was a bit of a quiet one with the lack of key data releases and the market appearing to be taking a bit of a breather after last week's rumble and tumble. Heading into the session, the focus is all about the trade rhetoric with the Japanese yen leading the way.
But USD/JPY stayed subdued for most of the session even as European equities moved lower, trading at 110.40 to 110.50 levels for the most part. The same kind of session can be said for AUD/USD and NZD/USD as well with both pairs ranging around current levels seeing little change on the day - only gaining some ground in the last hour as the dollar weakened.
GBP/USD started the session around the 1.3260 levels before falling to test Friday's low @ 1.3250 after the cash equity market opened. The pair then fell to a low of 1.3226 on the day before climbing back up to near 1.3250 levels as the dollar declined.
EUR/USD meanwhile saw similar action with the pair trading around 1.1600 before falling to a low of 1.1566 early on with some jitters surrounding Germany's political situation. But the pair reversed those losses later in the session and posting a high of 1.1618 on the day.
USD/CAD started the day higher trading around 1.3180 levels but soon fell to a low of 1.3160 after oil rallied following a report by Bloomberg that the oil output hike may be less than anticipated by OPEC+ participants later this week. The pair continues to trade near the lows thereafter.
It was very much a rangy session for currencies but the talking point on the session is that of oil. It's a big week for the oil market this week - may be considered the biggest week - as OPEC and non-OPEC members meet to renew terms of the existing OPEC+ agreement.
Coming into today, talks are of a 1.5 million bpd increase in oil output and oil traded at 2-month lows at the start of the session. But the Bloomberg report above changed things and we saw WTI crude oil bounce back from near the lows around $63.80 to a high of $64.92 on the day.
It still currently trades lower heading into the US session, but expect headlines like that to continue to drive some spikes in the market when they come about ahead of the meetings in Vienna that are to come.
Here's a primer on what you need to know about oil this week.
