Forex news from the European session - 25 October 2018
Headlines:
- US reportedly refusing to resume trade talks without firm proposal from China
- CBRT holds one-week repo rate steady at 24.00%
- The ECB doesn't need to rock the boat...yet
- More from Raab: Will not accept separate customs arrangement proposal
- UK's Raab: Risk of no-deal Brexit is real if EU engages in intransigent approach
- Ifo economist says difficult to achieve German growth forecast of 0.6% in Q4
- Germany October Ifo business climate index 102.8 vs 103.2 expected
- Italy's Di Maio: Confident that Italy-Germany bond yields spread will fall over the next few weeks
Markets:
- AUD leads, CHF lags on the day
- European equities trade higher, E-minis up by 0.8%
- US 10-year yields up 2.5 bps to 3.128%
- Gold down 0.04% to $1,233.22
- WTI up 0.33% to $67.04
- Bitcoin down 0.53% to $6,391
The session started with sluggish tones in Asian equities alongside a mild recovery in US equity futures. The Nikkei suffered a 3.7% fall on the day and that kept yen pairs anchored to begin the session but as E-minis started pulling higher, it dragged European equities from the doldrums to the highs and suddenly all is well with risk again... for now.
USD/JPY started the session around 111.90 to 112.10 as Japanese stocks slumped but recoverd to 112.35 as the session progressed and continues to trade near the highs with E-minis up by 0.8% currently.
The turnaround in European equities also meant that the CHF was offered during the session as USD/CHF reversed from 0.9970 to trade at the highs now close to parity.
Aside from that, there wasn't much else going on in markets as European traders awaiting for Super Mario and the ECB to help out with direction in the euro before focus starts turning back to the US cash equity market again.
EUR/USD trades narrowly in range between 1.1395 and 1.1420 this session. Likewise for GBP/USD as the pair swings between 1.2890 and 1.2915 for the most part as it continues to pivot around the 1.2900 level.
Meanwhile, the loonie is still extending gains following the BOC decision yesterday as USD/CAD trades lower at around 1.3045 currently. The pair held near the lows for the most part around 1.3020 to 1.3035 but has moved up a little in the past hour.
The aussie leads gains on the day with AUD/USD once again bouncing off near the year's lows as shorts are covered and iron ore prices continue to hold up well - hitting seven-month highs. The pair trades around 0.7065 to 0.7080 for almost the entire session.
