Forex news from the European morning session - 8 February 2019
Headlines:
- May is said to seek legally binding changes to withdrawal agreement in meeting with Ireland's Varadkar
- US considering three car tariff options, including 10% levy - report
- Istat says that it foresees pronounced slowdown in Italian economic activity
- France December industrial production +0.8% vs +0.6% m/m expected
- Germany December trade balance €13.9 billion vs €16.5 billion expected
- Switzerland January unemployment rate 2.8% vs 2.7% expected
Markets:
- CHF leads, AUD lags on the day
- European equities lower; E-minis down 0.6%
- US 10-year yields down 2 bps to 2.637%
- Gold up 0.2% to $1,312.61
- WTI down 0.6% to $52.33
- Bitcoin up 0.9% to $3,390
It's been a really quiet session in European morning trade as most major currencies are heading into North American trading almost unchanged (<0.1% changes) on the day against the US dollar. Trading ranges remain narrow for the most part due to the fact that market participants have very little to work with as key headlines have been few and far between today.
The aussie remains the main laggard after the RBA slashed growth forecasts in its statement on monetary policy during Asian trading. AUD/USD started the morning in Europe around 0.7080 before rising slightly to 0.7090 levels but is back to trading near 0.7080 currently in an uneventful session.
The dollar was a notable mover early on as it gained some ground which saw EUR/USD fall from 1.1340 to a low of 1.1323 before the greenback surrendered those gains later on. The pair now trades close to 1.1340 again as we await US traders to join in the fray.
Cable was a decent mover as it fell to 1.2921 as the dollar gained some poise early on before reversing those losses to hit a high of 1.2972 mid-way through the morning. However, buyers were unable to break above the 100-hour moving average @ 1.2975 and price is falling back to near unchanged levels around 1.2950-60 currently.
There wasn't much other action on the day as sluggish risk sentiment is also failing to offer traders with much clues. Looking ahead, the main focus will be on how markets react to risk sentiment later as North American traders come in. As it stands, there is a slight hint of risk aversion but no full-fledged risk-off mood just yet. I reckon that will remain the case as we wrap up the week.
Also to come, we'll have Canadian jobs report for January due at 1330 GMT so that'll be a key risk event for loonie traders.
