Europe Summary and Highlights 14 February

European morning session

The USD was marginally softer in a quiet European morning, maintaining the losses seen overnight, with GBP, CHF and AUD edging up around 0.1% but EUR, JPY and CAD little changed. 

Newswise, there was a small upward revision in Eurozone Q4 GDP to 0.1% q/q, with employment also  up 0.1% on the quarter, while German WPI was up a larger than expected 0.9% in January, but in general the market was quiet, awaiting further tariff news and the US data later.

Asia session

The reversal in USD/JPY continues as "sell the fact trade" kicks in after Trump's announcement of reciprocal tariff seems to be on the softer side. JGB yields are outperforming their U.S. Treasury counterpart, which will likely be supportive for the JPY. Japan chief cabinet secretary Hayashi says will respond appropriately to US tariffs but has not and does not seem likely to retaliate with more tariffs after the first U.S.-Japan summit. USD/JPY is trading 0.07% lower at 152.68.

The risk sentiment is broadly positive on Friday after Trump's announcement on reciprocal tariff is viewed to be softer than most expect. The HSI is leading with more than 2% of gains while Nikkei lags. USD is trading individually against major currencies. AUD/USD is up 0.03% at 0.6319, NZD/USD rose 0.14% to 0.5685 while USD/CAD slips 0.03%. Else, EUR/USD is down 0.13% and GBP/USD is down 0.11%.