Forex news from the European trading session - 8 May 2020
Headlines:
- ECB's Lagarde: ECB will play full part within mandate to help the economy
- ECJ says only it alone can rule that an EU institution have broken EU law
- Reminder: Post-Brexit trade negotiations set to resume again next week
- WHO: COVID-19 is a type of coronavirus that starts in bats
- Germany March trade balance €17.4 billion vs €18.8 billion expected
- Spain deputy PM warns EU: Step up or risk extinction
- Germany reports 1,209 new coronavirus cases, 147 deaths in latest update
- Australian PM Morrison says cannot see international travel for foreseeable future
Markets:
- NZD leads, JPY lags on the day
- European equities higher; E-minis up 1.0%
- US 10-year yields down 1.6 bps to 0.624%
- Gold up 0.2% to $1,719
- WTI up 0.8% to $25.03
- Bitcoin up 1.3% to $9,930
It was a rather subdued session with London on holiday, as major currencies traded tepidly in anticipation of the US non-farm payrolls report release later.
EUR/USD ranged around 1.0820-30 levels, keeping under its 100-hour moving average while GBP/USD also kept around 1.2370-00 levels under the same key technical level.
US futures are keeping higher, so that is helping to underpin the aussie and kiwi a little.
That said, AUD/USD is keeping below its 100-day moving average and traded quietly around 0.6510-30 for the most part during the session.
All eyes are on the US non-farm payrolls report, but the trade may not be on the reaction to the numbers - since this is largely anticipated and priced in already - and instead it could be on the fact that the risk event in itself is out of the way ahead of the weekend.
Stocks are still showing much enthusiasm on trade war drums and reopening of economies, but you have to figure what sort of undertone is the market actually thinking to even consider pricing in a negative Fed funds rate if the economic situation is getting better.
It feels like bonds and equities are starting to send conflicting signals (finally) about where all this may be going, so let's see how this all plays out towards the end of the week.
Have a good weekend, everyone!
