Today’s Rates & Market News

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 Today’s Rates

GBP>EUR – 1.1028

GBP>USD – 1.2603

EUR>USD – 1.1428

GBP>CAD – 1.7122

GBP>AUD – 1.8005

GBP>SEK – 11.433

GBP>AED – 4.6275

GBP>HKD – 9.7690

GBP>ZAR – 20.950

Today’s Calendar     

·         JPY    BoJ Monetary Policy Statement  

·         JPY   BoJ Interest Rate Decision  

·         GBP   Consumer Price Index (YoY)(Jun)

·         JPY   BoJ Press Conference  

·         CAD    BoC Rate Statement   

·         CAD    BoC Interest Rate Decision (Jul 15)     

·         CAD    Bank of Canada Monetary Policy Report (Jul)   

·         CAD    BoC Press Conference 

·         NZD    Consumer Price Index (YoY)(Q2)     

 

 Today’s Highlights

  • EUR Pulls back from highs
  • GBP Eyes on CPI’s and how they could affect the pound
  • GOLD Bulls gather pace for further upside
  • CAD Focus on rate decision

 

(https://frank-exchange.com/)

Markets

GBP

Cable rallied to a two-day high at 1.2605, extending a strong rebound from Tuesday’s eight-day low at 1.2479. The rise in Cable was not just a softer dollar story, as the pound concurrently rebounded against the euro, driving EUR-GBP to a 0.9051 low, extending a correction from yesterday’s two-week high at 0.9115. GBP-JPY also lifted to a two-day high. Analysts anticipate only limited upside potential for the pound, with risks remaining to the downside. Yesterday’s data showing much weaker than expected UK May GDP figure, of 1.8% m/m growth versus the median forecast for 5.5%, is a backdrop negative. Another is the independent Office for Budget Responsibility forecasting UK GDP shrinking by 10% in 2020. The 2-year Gilt yield also dipped below that of the 2-year JGB for the first time. These factors arrived with the UK currency trading at relatively lofty levels following two-week phase of outperformance, and with signs from the UK and EU trade discussions suggesting that the two sides are unlikely to agree on anything but a narrow trade deal

World

The dollar and yen have remained on a softening track against most other currencies, while the euro has remained broadly underpinned amid expectations for EU leaders to green-light the proposed EUR 750 bln recovery fund this week. The pound managed to rebound after underperforming over the prior two days. Risk appetite has been buoyant, with Asia stock markets rallying and U.S. equity index futures gaining, underpinned by news that U.S. biotech company Moderna’s candidate vaccine for the SARS Cov-2 coronavirus was shown in an early-stage trial to be safe while successfully provoking immune responses in all 45 of the volunteers. The narrow trade-weighted USD index carved out a fresh one-month low at 96.07, drawing in on the four-and-a-half-month low seen in June at 95.72. EUR-USD matched June’s four-and-a-half-month peak at 1.1423. Cable rallied to a two-day high at 1.2605, extending a strong rebound from Tuesday’s eight-day low at 1.2479. The rise in Cable wasn’t just a softer dollar story, as the pound concurrently rebounded against the euro, driving EUR-GBP to a 0.9051 low, extending a correction from yesterday’s two-week high at 0.9115. GBP-JPY also lifted to a two-day high. USD-JPY was again directionally limited, holding a narrow range in the lower 107.00s. The pair yesterday retreated after edging out a one-week high at 107.44. The risk-sensitive AUD-JPY cross printed a five-week high at 75.29. AUD-USD similarly reached a five-week peak, at 0.7018. The BoJ left policy unchanged, as had been widely anticipated. Governor Kuroda maintained dovish guidance, noting that there remain various tools that could be utilized for further easing. Of the many things to be focusing on, one is the looming end of the pandemic paycheck protection program in the U.S. and other government bailout schemes. Most likely there will be an extension.

XE Market Analysis Europe – 14th Jul 2020

This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited/Manor House Foreign eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result.  Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.

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