ForexLive European morning wrap: Euro the star turn in a lively session

Forex news for European morning trading on June 27 2017

News:

• Draghi says ECB will need to be gradual when adjusting policy parameters
• More from Draghi: Considerable amount of stimulus still needed
• US Fed's Williams says they're in process of gradually withdrawing stimulus
• BOE Financial Stability Report - Stands ready to cut buffer if conditions deteriorate
• BOE's Carney sees financial stability risk from Brexit
• More from Carney: Monetary policy the last line of defence to create stability
• USDJPY posts fresh session lows
• Option contract expiries for 14.00 GMT 27 June
• Nikkei 225 closes up +0.36% at 20,225.09

Data:

• UK CBI June distributive trades survey 12 vs 5 exp
• Italy June consumer confidence 106.4 vs 105.8 exp

It's been a busy session that initially saw some general USD supply with USDJPY continuing its Asian retreat from 112.08 but has since turned into a celebration for all things euro.

It was always going to be an interesting morning with a raft of CB action and with more to come when Yellen takes to the mic at 17.00 GMT in London.

Draghi's comments confused the markets but seemed just a tad more hawkish than lately and we saw EUR pairs rally. EURUSD has been up to 1.1275 from 1.1185, EURGBP 0.8839 from 0.8785 and EURJPY up to 1 year highs of 126.30 so far.

GBPUSD meanwhile had its own rally after the BOE FPC stability report announced rises to banks' capital requirements and that sent GBPUSD through 1.2750 to 1.2774 before dipping back toward 1.2730.

Carney's presser comments offered nothing of note but he did highlight concern on consumer credit levels but made no real sound bites on mon pol except to say it was the last line in stability defence.

CHF demand has been notable with USDCHF retreating to 0.9648 as EURUSD rallied but EURCHF also slipping a little when other euro pairs have only gone higher.

AUDUSD started on the front foot at 0.7600 and extended gains only to drop back with option expiries in play.

Equities opened a little softer but extended losses while oil has made a steady advance through the session and that's seen USDCAD fall to test 1.3200 from 1.3260.

So it's all eyes on London now and Yellen at 17.00 GMT.