Europe Summary and Highlights 5 May
The JPY was generally weaker through the European morning as equities traded firmer. The USD edged marginally lower against European currencies
European morning session
The JPY was generally softer through the European morning, helped by firmer equities, which benefited from some softening in the oil price. After opening around 157.20 USD/JPY reached a high of 157.80 before edging lower. The USD was otherwise fairly steady, falling back slightly against European currencies and reversing early gains against the AUD. The CHF gained ground across the board after Swiss April CPI, even though this was in line with consensus at 0.3% m/m. EUR/CHF dropped 10 pips to 0.9155 before bouncing to 0.9160.
Asia session
After U.S. announced Project Freedom. Iran categorized such as act of hostile and warned ships to not follow. It is later reported that Two US Navy destroyers, the USS Truxtun and USS Mason, successfully transited the Strait of Hormuz even until the barrage of Iranian fire. While it demonstrates U.S. capacity, it also suggest Iran will not yield and let ship pass peacefully. USD/JPY is trading 0.02% higher at 157.24.
As per forecast, the RBA increased cash rate to 4.35%. It is of majority vote instead of a spilt decision in Q1 2025. Obviously, the energy shock continue to contributes toward an above target range CPI with little sign of slowing yet. The RBA seems to be comfortable after three consecutive hike and looks done for now in their forward guidance. AUD/USD is trading 0.25% lower at 0.7149. NZD/USD is trading 0.2% lower while USD/CAD rises 0.02% with oil lower. Else, EUR/USD is down 0.06% and GBP/USD is down 0.1%.