North American Summary and Highlights 19 February
Overview - The USD was mostly firmer, but ended off its highs after the FOMC minutes were digested.
North American session
The USD was overall little changed in North America, though USD/JPY was marginally weaker near 151.50 and USD/CAD marginally stronger given threatened auto tariffs if meeting resistance near 1.4250. EUR/USD did come under some pressure testing 1.04 as Trump described Ukrainian President Zelensky as a dictator but recovered to around 1.0425 with FOMC minutes not seen as hawkish. Comments from Fed’s Bostic had a similarly moderate tone.
US housing starts fell 9.8% to 1366k, on the weak side of expectations, but with permits up 0.1% to 1483k, above consensus, the starts dip looked weather-induced.
European morning session
The USD was generally firmer through the European morning. EUR/USD lost 30 pips to 1.0430, and GBP/USD lost 30 pips to 1.2590. USD/JPY rise more modestly, gaining 20 pips to 151.80, and the AUD, CAD and scandis saw similar declines. USD/CHF was little changed at 0.9035.
The main news of the morning was the UK January CPI data, which was higher than expected at 3.0% headline, 3.7% core, although the core rise was broadly in line with expectations. GBP managed some initial gains after the data, with EURGBP hitting a low of 0.8273, but finished the morning little changed near 0.8285. Otherwise, there was little news of any real note. The Eurozone current account surplus for December was larger than expected at EUR38.4bn.