USD/JPY, EUR/USD, flows: some focus on the Strait; dollar does take out some levels
Some focus on movement in the Strait, equities and European bonds firmer, though not getting carried away
Dollar does make its mini break firmer, threatened over the last few days
The passing of 30 Chinese ships through the Strait among the factors clearly giving the market a bit of a lift today, both equities and European bonds, but given the timing it clearly asks more questions than provides answers and oil is hardly getting carried away with any minor dip. The biggest doubt is to what extent does this mark any shift in the blockade standoff at all (or any intervention from China in the process), as opposed to more likely just an opportunistic move to shift some vessels hassle-free while Trump is in China. Free passage for all with no Iran coordination or payment is of course a million miles from this one-day selective smuggle and there’s no word on any actual deal progress. With the dollar having a bit of a bid today, amid also some broader commodity FX profit taking, EUR/USD has finally taken out 1.17 more convincing to move down to the noted next levels, while USD/JPY has also seen quite a lot of intraday volatility on the push through 118, whether any kind of official hand in that or seemingly otherwise. Choppy asset market cross currents continue to dominate.