Europe Summary and Highlights 17 Aug
USD generally softer across the board on ongoing summer low vol and Fed expectations retreat drivers
CHF also sees a technical bounce as EUR/CHF uptrend held by test of Dec25 resistance
Europe
Dollar generally remains on the back foot, leaking lower across the board, with the low volatility, solid risk summer drift tone, together with the retreat in Fed expectations, playing with the grain.
As well as firmness in risk/USD (AUD,NZD,SEK..), CHF is also firmer on the morning in technical driven trade, as EUR/CHF initially backs off the test of 0.94~, the Dec25 highs.
EUR/USD tests to the mid-June highs just above 1.16, before consolidating just off the figure.
Twin-track market picture continues, with the low vol, risk/USD summer mood on the one hand, but absolutely no sign of progress from the US-Iran staring contest on the other. Brent +$1, just off $90.
Asia Session
Japan Q2 preliminary GDP missed at 0.3% q/q. As we expected, the lag in private consumption is dragging Japan's Q2 growth. Yet, GDP deflator is a beat at 2.6% y/y, continue to points toward strong price pressure. USD/JPY is trading 0.14% lower at 159.08. JGBB yields are also higher across the curve.
USD is off to a weak start despite geopolitical tension persists. Regional equities are outperforming U.S. equities so far, while precious metals are gaining. AUD/USD is trading 0.27% higher at 0.7104. NZD/USD is leading with 0.35% gains while USD/CAD slips 0.08%. Oil are lower. Else, EUR/USD and GBP/USD are up 0.14%.