North American Summary and Highlights 17 April
Overview - With the ECB easing as expected, FX movements were modest but riskier currencies managed modest gains.
North American session
FX movements were modest. Risky currencies advanced, assisted by gains in oil, even if equity advances faded on a WSJ report that Trump had approached former Fed Governor Kevin Warsh as a possible replacement for Powell, though both Warsh and Bessent were said to have advised against replacing Powell. AUD/USD rose to .6390 from .6360, GBP/USD rose to 1.3270 from 1.3230 while USD/CAD fell to 1.3840 after briefly reaching 1.39. USD/JPY retuned to 142.40 after a brief dip below 142 as UST yields picked up.
EUR/USD was little changed near 1.3875 with a 25bps ECB easing as expected. US data was mixed with initial claims low at 215k suggesting a still healthy labor market but the Philly Fed manufacturing index weak at -26.4 pointing to damage from tariffs. Housing starts fell by 11.4% while permits increased by 1.6%.
European morning session
The USD was generally slightly weaker through the European morning. EUR/USD gained 20 pips to 1.1375, and there were similar gains for GBP and AUD. The scandis outperformed, with EUR/SEK falling 8 figures to 11.06 and EUR/NOK falling 4 figures to 11.98. The JPY, CHF and CAD were little changed against the USD.
There was little news of note. German PPI data was somewhat weaker than expected, falling 0.7% m/m in March. The BoE credit conditions survey suggested improving mortgage availability in the next 3 months, but unchanged demand.