North American Summary and Highlights 29 May
Overview - The USD was generally firmer as equities slipped. UST yields increased but yields were also higher in Europe.
North American session
German CPI rose by 0.1% on the month with yr/yr data on consensus at 2.4% from 2.2%. HICP rose 0.2% on the month, with yr/yr data slightly stronger than expected at 2.8% from 2.4%. European yields moved higher, though so did UST yields and USD was around 0.4% stronger across the board, with equites slipping. There was no significant US data. The Fed’s Beige Book looked very similar to the previous report.
EUR/USD slipped from 1.0850 to test 1.08 while GBP/USD slipped from 1.2750 to test 1.27. USD/JPY rose from 157.20 to 157.70. USD/CAD moved above 1.37 while AUD/USD slipped to near .6610.
European morning session
The USD was not much changed through the European morning, falling back after a brief rise against the EUR following the German state CPI data. EUR/USD dipped 20 pips to a low below 1.0830 but bounced back above 1.0850 by the end of the morning. The German state CPI numbers were seen by some as being on the soft side of consensus, but look to us to be essentially in line with the expectation of a 0.2% rise in the y/y rate for national CPI. Eurozone money and credit data was also released, which was marginally on the soft side of expectations with loan to households rising 0.2% m/m, but were of little significance. Earlier, German Gfk consumer confidence data for June rose once again to the highest in more than 2 years.
Otherwise, FX was fairly quiet. Although USD/JPY did see a brief spike lower to 156.90 after opening around 157.25, the decline was short lived and USD/JPY finished the session back up at 157.15. NOK/SEK gained around 30 pips to 1.0090, with EUR/NOK lower and EUR/SEK higher.