Forex news from the European morning session 8 Mar

News:

  • BOE's Carney: Nothing we say should be interpreted as a recommendation on EU membership
  • Carney says extra liquidity operations by BOE are "entirely precautionary"
  • More from Carney: It's in the UK interest to see European monetary union put on sounder footing
  • More from Carney: Brexit could weaken the pound and push up inflation
  • BOE's Cunliffe says the UK is in "unchartered territory" should Brexit be the referendum outcome
  • BOE ready to throw a heap of money into the system should Brexit be the referendum outcome
  • Germany's Schaeuble says increase in EU countries' debt clearly the wrong direction
  • OECD indicators point to global economic growth slowing overall
  • Spain's De Guindos sees 2016 GDP close to 3%
  • Kuwait will agree to an oil production freeze only if all major producers do too
  • Earthquake of 6.2 magnitude hits southwest of Samoa
  • Option expiries 10am NY cut today 8 March
  • Nikkei 225 closes down -0.76% at 16,783.15

Data:

  • Eurozone Q4 GDP flash qq +0.3% as exp
  • Germany industrial production Jan mm SA +3.3% vs +0.5% exp
  • France trade balance Jan -€3.712 bln vs -€4.1bln exp
  • Switzerland CPI Feb mm +0.2% vs -0.1% exp
  • Switzerland unemployment rate Feb SA +3.4% vs +3.5% exp
  • US small business optimism shrank in February
  • Japan economy watchers survey Feb current 44.6 vs 47.4 exp

It's been a session of limited moves albeit still opportunity with focus on BOE governor Carney's Brexit testimony.

Large option expiries on USDJPY at 113.00 are casting a shadow and keeping the pair contained but yen gains on year-end repatriation continue with equities on the back foot again. Early move up through 113.10 soon found sellers and we moved back to test support around 112.80 as a general USD-sell sentiment prevailed.

That saw EURUSD test 1.1050 and GBPUSD 1.4280 but in muted conditions we've seen both those move lower to test the support at 1.1000 and 1.4200 with EURJPY and GBPJPY turning down too.

Kuwait's position on oil production freeze/cap saw the price drop and that gave USDCAD a leg up while gold has nudged up to look at $1278 before running into a few sellers. The firmer tone overall though has continued to give support to AUDUSD into 0.7400 and rally to look at 0.7450-60 again.

Carney's testimony was a fascinating contest as lawmakers did their best to wind him up but Mr C was equal to the task. Didn't help provide any real market volatility or news-bombs but all adding to the bigger Brexit debate.