North American Summary and Highlights 23 October
Overview - The USD advanced versus JPY, GBP and AUD, but was little changed versus the EUR and CAD, with a 50bps Bank of Canada easing being as the market expected.
North American session
USD/JPY, after touching 153 corrected down to near 152.60. EUR/USD had little direction ending little changed around 1.0780. GBP/USD however came under pressure falling to near 1.29 before a modest correction, as EUR/GBP rose to .8340 from .8310. US existing home sales were weaker than expected with a 1.0% fall to 3.84m while the Fed’s Beige Book saw inflation continuing to moderate.
The main news of the day was a largely as expected 50bps easing from the Bank of Canada. USD/CAD rose as far as 1.3863 but ended little changed near 1.3840. AUD/CAD was weaker near .9175 as AUD/USD fell to .6630 from .6650.
European morning session
The USD was generally strong and the JPY continued to weaken through the European morning. USD/JPY gained 60 pips to 152.75, while EUR/USD lost 20 pips to 1.0785. AUD/USD lost 20 pips to 0.6655. CHF, CAD and GBP were only slightly weaker against the USD, with GBP/USD dropping only 10 pips or so to 1.2980 while EUR/GBP lost 10 pips to 0.8310.
There was no news of any real note during the morning, with no data of significance in Europe. However, EUR front end yields slipped lower, helping to soften the EUR against the USD, perhaps reacting to Lagarde and Centeno comments on Tuesday, although today’s comments from Rehn were less dovish.