Europe Summary and Highlights 23 October
The USD was generally strong and the JPY continued to weaken through the European morning.
European morning session
The USD was generally strong and the JPY continued to weaken through the European morning. USD/JPY gained 60 pips to 152.75, while EUR/USD lost 20 pips to 1.0785. AUD/USD lost 20 pips to 0.6655. CHF, CAD and GBP were only slightly weaker against the USD, with GBP/USD dropping only 10 pips or so to 1.2980 while EUR/GBP lost 10 pips to 0.8310.
There was no news of any real note during the morning, with no data of significance in Europe. However, EUR front end yields slipped lower, helping to soften the EUR against the USD, perhaps reacting to Lagarde and Centeno comments on Tuesday, although today’s comments from Rehn were less dovish.
Asia Session
With the lack of strength from Japanese officials' verbal intervention, USD/JPY continues to rise as U.S. Treasury Yields are outperforming JGB yields. There is no sign from the Japanese end they would like to curb the recent JPY fall. The momentum for USD/JPY rally remains strong and a correction seems unlikely unless we hear a hawkish preview of next week’s BoJ. USD/JPY ran past 152 to trade 0.68% higher at 152.10.
Regional sentiment is mostly positive with HSI leading and Chinese equities also upbeat. While Nikkei is lower and U.S. equity indexes are little changed. AUD/USD is 0.04% lower at 0.6680, NZD/USD is also 0.08% lower at 0.6039 while USD/CAD is unchanged. Else, EUR/USD and GBP/USD are up 0.05%.