Forex news for North America trading on June 22, 2021:
- Fed's Powell: Inflationary factors will wane over time
- US May existing home sales 5.80m vs 5.72m expected
- June Richmond Fed 22 vs 18 exp
- UK-EU officials increasingly optimistic in Northern Ireland border dispute - report
- Fed's Daly: Looking to the fall to get some more clarity on economy
- Fed's Mester: We're not at the point to dial back accommodation
- More from Mester: Not yet thinking about adjusting monetary policy
- Eurozone June advance consumer confidence -3.3 vs -3.1 exp
- Philly Fed June non-manufacturing activity 59.6 vs 36.9 prior
Markets:
- WTI crude oil down 24-cents t o$72.88
- US 10-year yields down 2.0 bps to 1.468%
- Gold down $6 to $1770
- Bitcoin hits as low as $28,800 before rebounding to $32,540 last
- NZD leads, JPY lags
The FX market was lively today as the dollar continues to give back gains, particularly against the commodity currencies but it was crypto that stole the show.
Dogecoin and other alts took a beating in Europe and Asia but bitcoin wasn't hurt too badly until New York rolled and and started selling. The fall through $31,000 cascaded all the way down to $28,800 over a few hours but just as the obituaries were being written it pulled off an incredible comeback to $33,000. The trigger might have been headlines noting that it was back to flat on the year. Whatever it was, the huge swings mean the days ahead will continue to be lively.
The general risk trade improved throughout the day but you can't point to any of the headlines. Fed talk is turning into more of a chorus and there's really no urgency to hike rates or taper. There's a strong consensus on waiting until the fall to evaluate data.
The dollar continued its retracement as the euro marched above 1.1900 up to 1.1953 late. Cable also hit a session high of 1.3964 late, though the UK-EU headlines had little to do with it.
The larger moves were in commodity currencies, particularly the loonie. Oil mostly shrugged off earlier headlines about OPEC+ discussing further production hikes in August because that's been the plan all along. Still, you have to admire how little crude has given back in the run up this year. Commodities in general stabilized aside from a few of the softs.
AUD/USD remains the most-compelling chart on my deck. It's struggling to get back above Friday's high and the 200-dma but it will be within striking distance again tomorrow.
