Published: 2024-08-12T10:02:44.000Z
Psychology for major markets August 12th
Senior FX Strategist
3
Fairly neutral picture after a week lacking important data. Mild risk recovery being seen but focus on US CPI data midweek.
EUR/USD – EUR/USD holding close to 1.09. Underlying tone remains neutral.
USD/JPY – USD/JPY corrected higher helped by comments from BoJ deputy governor Uchida. But underlying picture remains weak.
EUR/GBP – Dropped back to 0.8550 on general risk recovery, but picture now more neutral until or unless we see divergence in UK/EU economies/monetary policy.
AUD/USD – AUD found some support below 0.64 and has extended gains to the high 0.65s as risk sentiment stabilises. Further upside scope exists if risk sentiment continues to improve.
Equities – Slumped after softer US employment data, helped by unwinding of JPY funded risk positions, but is recovering modestly. High US valuations limit the scope for recovery despite sharp yield declines.