Europe Summary and Highlights 28 June

European morning session

The USD was generally softer through the European morning, losing around 0.15% against most currencies, but the AUD outperformed, gaining 0.5% or 30 pips. USD/CHF was the exception, trading little changed as EUR/CHF extended gains above 0.96.

Newswise there was some European data, but nothing particularly surprising, with French, Spanish and Italian preliminary CPI for June broadly in line with consensus. German unemployment rose a little more than expected, with the rate up to 6.0% for the first time since March 2021, and UK Q1 GDP was revised up slightly to 0.7% q/q from 0.6%, but there was little FX impact from any of the data.

Asia Session

Despite the emptiness from presidential debate, USD has been gaining since Hong Kong market opens and brought USD/JPY past the 161 figure. We heard another escalation in rhetoric from Suzuki as he said he is deeply concerned about excessive, one-sided moves on forex, there is little sign of an actual action. U.S. Treasury Yields are trading higher while JGB yields skids. Tokyo y/y headline CPI for June came in stronger than may at 2.3%, ex fresh food at 2.1% and ex fresh food & energy at 1.8%. The data remains supportive for BoJ to tighten but does not seem to spur any hawkish expectation. USD/JPY is trading 0.2% higher at 161.05.

Regional sentiment is outpacing U.S. three major equity indexes in the green while commodities are lower. However, king dollar remain in the driver seat and is leading the way within major pairs. AUD/USD fell 0.37% to 0.6622, NZD/USD also slipped 0.37% to 0.6060 while USD/CAD rose 0.21%. Else, EUR/USD is down 0.15% and GBP/USD down 0.13%.