Europe Summary and Highlights 5 September
The USD was generally weaker through the European morning, losing 0.1-0.2% across the board.
European morning session
The USD was generally weaker through the European morning, losing 0.1-0.2% across the board. Early on GBP made some modest gains against the EUR after UK retail sales data for July showed a larger than expected 0.6% m/m increase. But the gains didn’t last, in part because the better m/m rise was not mirrored in the y/y data, as there were substantial revisions to the back data due to previous faulty seasonal adjustment. The underlying trend remains broadly neutral but with a mild weakening in the last few months.
German factory orders were weaker than expected, falling 2.9% m/m in July, while Eurozone Q2 employment growth and GDP were as expected at 0.1% q/q, but had no EUR impact. EUR/SEK dropped 3 figures to 11.00 reversing yesterday’s gains.
Asia session
The July Japan labor cash earning surprised to the upside of 4.1% y/y, along with stronger household spending, above 1% both m/m and y/y. It will be supportive for the BoJ's next hike as firms seems to be shaking off the fear of tariff uncertainty and regain the traction in wage hikes. USD/JPY is trading 0.2% lower at 148.19 as JGB underperform U.S. Treasury in yields.
The broad risk mood is positive as we see major equity indexes in the green. Market participants seems to be optimistic about the U.S. jobs later in the U.S. session, so as the mood with Trump and his tariff policy. AUD/USD is trading 0.14% higher at 0.6527, NZD/USD is trading 0.21% higher at 0.5859 while USD/CAD slips 0.06%. Else, EUR/USD is up 0.14% and GBP/USD is up 0.09%.