European Summary and Highlights 25 Jan
The USD was slightly weaker across the board through the European morning session.
European morning session
The USD was slightly weaker across the board through the European morning session. EUR/USD gained around 15 pips to 1.0895, and other USD pairs saw similar moves. The scandis were both a little stronger against the EUR, gaining a couple of figures each, while EUR/CHF rose around 10 pips, but there was little other cross movement.
The main news of the morning was the German IFO survey, which came in weaker than expected. The business climate index and the current conditions index both hit their lowest since the pandemic, and excluding the pandemic the lowest since the GFC. However, there was little FX impact, with the EUR remaining resilient. Earlier, the French INSEE survey was unchanged on the month in January. The UK CBI distributive trades survey hit its lowest since the pandemic, but had no impact, as this survey is not much watched nowadays.
Asia session
We had some jawbone intervention from Kanda but it seems to be only regarding the latest volatility. But it seems to have little impact towards USD/JPY as there was already a correction on Wednesday where the pair retreated from 148.38 to almost 2 figures lower. 10yr JGB yields continued its strength while U.S. Treasury Yields skids. USD/JPY is recovering some of the Wednesday lost ground to trade 0.2% higher at 147.78.
Regional sentiment is performing better after Wednesday Chinese stimulus. Yet the upbeat sentiment did not transfer to the antipodeans as USD is gaining ground across board. AUD/USD is trading unchanged, NZD/USD is down 0.05% while USD/CAD is also unchanged. EUR/USD is down 0.05% and GBP/USD is down 0.09%.