Psychology for major markets June 13th

EUR/USD – Back above 1.08 after the weaker US CPI despite the more hawkish Fed stance. Sentiment still undermined slightly by French election concerns, so fairly neutral picture near 1.08.

USD/JPY – Failed to sustain the drop after the weak US CPI, but still looks capped near 158.

EUR/GBP – Edged up to the mid 0.84s as EUR/USD recovered after weaker US CPI. Focus on next week’s UK CPI and MPC meeting with a neutral tone.

AUD/USD – Back in the middle of the 0.66-067 range after weak US CPI and strong Australian employment, but the range looks unlikely to break near term.

EUR/CHF – Heavy CHF short positions suggest downside risk especially with political uncertainty growing in Europe after EU elections, but support at 0.9620 near term.

Equities – New high seen as yields dipped after CPI but valuations getting stretched.