Forex news for European morning trading on June 20 2017

News:

  • Carney says now is not the time to raise rates
  • More from Carney: G20 needs "to make trade work for all"
  • Hammond says future trade deals post-Brexit must reflect UK's service-based economy
  • Merkel aiming to reach broad agreement on open markets at G20 summit
  • SNB's Jordan says exiting expansionary policy is not currently a topic of discussion
  • More from Jordan: Negative rates are a big success in Switzerland
  • PIMCO CIO says US Fed could hike rates 4 times in 2018 but recession likely
  • UK SFO charges 4 former Barclays executives over 2008 fund-raising with Qatar
  • US Fed's Fischer says more needs to be done to strengthen housing finance system
  • Swiss government sees 2017 GDP growth at 1.4% vs 1.6% previous forecast in March
  • IFO raises German GDP outlook for 2017/18
  • USDCAD nudges back up to session highs as oil tumbles
  • Forex option expiries for the 10am New York cut 20 June
  • Nikkei 225 closes up +0.81% at 20,230.41

Data:

  • Eurozone April current account SA EUR 22.2bln vs 35.7bln prev
  • Germany May PPI mm -0.2% vs -0.1% exp

BOE Carney's delayed Mansion Speech finally scattered a few pigeons and his "now is not the time to raise rates" comment sent algos into frenzied mood.

No one was ever talking imminent interest rate hikes but after the 5-3 vote last week there was some conjecture they might be closer. Not in my view though.

GBPUSD had just shrugged off some softer-Brexit rhetoric (as per my preview) from UK fin min Hammond at the same event and once Carney stood up his speech was published in full. Cue a rapid fall in GBPUSD from 1.2745 to 1.2678 and EURGBP up to test 0.8800 from 0.8745.

After a quick wipe of the feet were soon posting 1.2668 and 0.8805 before GBP buyers were brave enough to step back in and send the pairs back toward 1.2700 and 0.8780. Since then though and as NA desks stir we've seen renewed pound pressure but it's not been the only game in town.

Oil prices have tumbled over 1%. No news of note but growing/renewed perception that reduced demand will do little to counter the output cut deal. USDCAD had found support into 1.3200 and rallied to test Asian highs around 1.3250.

EURUSD has found itself trading tightly, contained by large option expiries between 1.1150-60 and cross play cross trades.USDJPY initially found support at 111.50 from 111.78 Asian highs and bounced back around 111.65 but was soon struggling again as a bit of yen demand returned.

USDCHF and EURCHF also found themselves drifting lower on CHF demand despite Jordan's repeated rhetoric about neg rates and intervention. Both pairs continue to range trade though.

Equities opened in firmer mode and the DAX advanced to post new record highs before running into a few sellers.

Data-lite today with only Canadian wholesales of any note but we do have another CB talking head in Rosengreen at 12.15 GMT and Kaplan at 19.00 GMT