Forex news from the European morning session 22 Sept

News:

  • China's Xi pledges more economic reforms despite slowing growth
  • China's H2 economic growth will be maintained in a reasonable range
  • UK's Osborne says the exit from loose monetary policy is coming
  • France's Sapin says China market fall not a threat to global economy
  • UK's Osborne expects appetite for offshore renminbi to grow
  • VW sets aside loss provision in Q3 of EUR 6.5bln
  • EU's Moscovici says Greek debt term changes are possible
  • Greek PM Tsipras will appoint Tsakalotos as finance minister
  • Option expiries 10am NY cut today 22 Sept

Data:

  • UK PSNBR August GBP 11.3bln vs 8.8bln exp
  • UK CBI industrial trends orders Sept -7 vs 0 exp
  • Swiss trade balance Aug CHF +2.87bln vs +2.75bln exp

Recent talk of US Fed rate hikes and on-going fall out from the VW scandal have helped to undermine European equities and forex traders have gone for the safe option

It was another slow start but the pattern soon emerged as equity markets got going and we saw yen pairs start to slide as USDJPY failed to hold above 120.50 and we were soon testing 120.00 then 119.85. EURJPY needed little excuse to follow it down to 134.00 and this tempered the attempt by EURUSD to rally above 1.1200 after posting early lows of 1.1155

The pound has found itself on the back foot after GBPUSD failed to hold above 1.5500 and we were soon testing 1.5480 again then 1.5450 and then ultimately 1.5433 so far after weak CBI data, and as EURGBP remains bid to post 0.7239 having found good demand at 0.7200

USDCHF drifted off to 0.9710 on more EURCHF selling early on but both pairs have found good support in the dips in what has been a mixed bag of a session across all the pairs

AUDUSD and NZDUSD both came under pressure on yen pair selling with the former giving up support at 0.7100 and NZDUSD at 0.6300 having found good supply above 0.7150 and 0.6330 respectively

USDCAD has taken out the 1.3260 offers/res on softer oil prices but is not racing away as yet

US markets opening soon and we'll be looking to equities again for clues