Europe Summary and Highlights 20 Jul
Afternoon trading saw the USD gain further ground, as reports that the Houthis would block Saudi exports through the Red Sea caused further tensions and helped oil and the USD.
Europe
The USD drifted marginally higher against European currencies during the European morning, with flow based trading and no major news during the period. Sentiment towards the USD remains cautiously positive, with Iran and U.S. in the 9th day of hostilities that is boosting oil prices and helping USD sentiment. It is cautious, as President Trump track record of U turns means that he could try to re-establish the ceasefire to reduce gasoline prices before the November mid-terms.
USD/JPY was steady, with the key question remaining whether the BOJ decides to undertake FX intervention to produce a bounce in the JPY. FX traders fear that a risk exists of such intervention that would trigger JPY short-covering across the board.
Afternoon trading saw the USD gain further ground, as reports that the Houthis would block Saudi exports through the Red Sea caused further tensions and helped oil and the USD.