Europe Summary and Highlights 5 Jan
The USD was slightly weaker through the European morning.
European morning session
The USD was slightly weaker through the European morning. USD/JPY dropped half a figure from 157 to 156.50, and GBP/USD gained 30 pips to 1.3460 following stronger than expected UK money data. AUD/USD was also slightly firmer at 0.6685, and the SEK also dropped a couple of figures to 9.22. But EUR, CHF, NOK and CAD were all little changed against the USD.
JPY strength may have been helped by general declines in US and European yields, likely related o uncertainty around Venezuela, following higher yields in Japan overnight helped by hawkish comments from BoJ governor Ueda.
UK money and credit data showed another month of stronger than expected gains, with M4 up 0.8% m/m and net lending to individuals at GBP6.6bn, even though mortgage lending was a little weaker than expected at 4.49bn. Mortgage approvals were, however, higher than expected at 64.53k.
Asia session
Over the weekend, Trump has stroke Venezuela and capture its president Maduro. Trump also commented on allow U.S. oil company to access Venezuela oil reserves. There are a lot of uncertainty floating around but one thing we are sure of is escalating geopolitical uncertainty. Precious metal continues to climb but the story today in the FX market is stronger USD. AUD/USD is trading 0.37% lower at 0.6669 after opening lower. NZD/USD is trading 0.37% and USD/CAD is trading 0.27% higher.
USD/JPY initially opened lower as market participants seek haven after the geopolitical turmoil in Venezuela. However, the gap did not last as USD gains the upper hand in terms of haven. BoJ's Ueda copy and paste comment did not have a lasting impact in supporting the JPY for none believe the political obstacle towards another hike is easy to overcome. USD/JPY is trading 0.30% higher at 157.28. Else, EUR/USD is down 0.37% and GBP/USD is down 0.32%. All opening gap has been closed, at least once during the Asia session.