Forex trading news and economic data headlines 7 February 2017
News:
- ECB's Villeroy says US govt should back off from making comments on FX
- Germany says they want equal treatment on market access from trade partners
- ECB's Coeure says euro is at appropriate level for the region's economy
- EU tells UK to settle all bills before it clears off
- RBA decision today (rates left unchanged) - analyst responses
- China FX reserves end-Jan USD 2.998trln vs 3.011trln prev
- Switzerland Jan foreign reserves CHF 643.7bln vs 646.1bln expected
- Australia January foreign reserves AUD 68.6bln vs 76.1bln prev
- Sarkozy to stand trial over illegal election finances
- UK house prices fall again in January
- Option expiries for the 10 am NY cut today 7 Feb
- Nikkei 225 closes down -0.35% at 18,910.78
Data:
- Germany Dec industrial production mm SA -3.0% vs +0.3% exp
- France December trade balance EUR -3.421bln vs -3.5bln exp
- Switzerland SECO Jan consumer confidence -3 vs -11 exp
A busy session that's seen heavy yen demand early on as risk-sentiment wobbled again but there's been some general USD demand too.
USDJPY began late-Asia/early-Europe on a bounce from 111.75 but failed to breach 112.00 and retreated. The 4th attempt though triggered stops to post 112.27 and that started a period of USD buying that saw GBPUSD, EURUSD, and AUDUSD all lower with USDCAD and USDCHF making gains.
The USDJPY rally though failed to prevent yen gains and we saw GBPJPY fall on order flows through 139.20 then 139.00 in a rush triggering stops and testing next lines at 138.50. GBPUSD fell through 1.2425 then 1.2400 in a similar rush triggering stops to post 1.2347 forcing EURGBP up to 0.8635 after earlier falling into the 0.8585 support area.
EURUSD has been on the back foot but once again caught in the crossfire while AUDUSD saw significant losses to 0.7608 from 0.7665 wiping out the post-RBA gains to 0.7681.
Treasury yields were rising and we were seeing some direct correlation. Equities were soggy and commodities lost a bit of shine.
We've had a decent yen reversal too though with traders taking money off the table after the rapid moves and we've seen USDJPY test 112.50, with EURJPY back above 120.00 and GBPJPY rallying through 139.00.
Unconvincing so far and we wait to see what NA desks can bring to the mix.
US and Canadian trade data the next data risk at 13.30 GMT
