North American Summary and Highlights 10 June
Overview - The USD was slightly firmer with Middle East risk outweighing a softer than expected US core CPI.
North American session
Ahead of the US CPI the USD got a lift as Trump stated that Iran had taken too long to negotiate a deal and would now have to pay the price. CPI came in as expected at 0.5% overall, but lower than expected at 0.2%, 0.208% before rounding and the USD more than fully erased its bounce on the Trump comment. As the session continued the USD picked up to build marginal gains, with Trump stating that Iran would be hit hard again sustaining Middle East concerns, which pressured equities.
USD/JPY was slightly firmer near 160.50 while EUR/USD was fairly stable near 1.1550. EUR/GBP saw little change though EUR/CHF continued to advance. USD/CAD found support near 1.39 and returned to 1.3940 after the Bank of Canada left rates unchanged with a balanced statement that saw Canadian front end yields slipping. AUD/USD found support near .70 but a bounce faded leaving the pair back near .70.
European session
While the news and broader asset market backdrop remains rather noisy with various cross-currents in play, FX price action is pretty becalmed with further consolidative trading still predominating. EUR/USD is still working off its intraday oversold posture in the 1.1550 area while higher beta pairs are off only mildly versus the dollar and within recent bars too.
Recent military exchanges have been digested by the market with oil trading down around -0.5%. There is more focus on NYT suggestions that some progress is being made on compromises with the key nuclear themes.
Overnight saw the Kospi off 5%, and the Nasdaq future is down over 1% although also still well clear of the spike low test in yesterday's wide bar. Copper though, for instance, is at the recent lows which is the key next range support area. As such USD/risk does have support, but it's mild so far this morning with no fresh breaks while the likes of VIX are still contained (<20). US CPI data the next focus and test.
Scandi data tending to come in on the upside this morning but with provisos. Norway core CPI on the top side of consensus at 3.4%y/y, albeit with that core measure including food and looking less elevated in smoothed monthly trend terms. The Norges Bank is already well ahead of the curve. NOK got a slight lift on the release.
Swedish orders, production and monthly GDP also on the firm side and does suggest a good Q2 shaping up, but again that is needed and then some for the rest of the year to be getting close to Riksbank expectations and survey projections have been less positive.
In other news, Reuters reports that BoJ's Ueda has been hospitalised and is expected to miss the June 15-16 meeting.