Europe Summary and Highlights 17 September

European morning session

Not much FX movement seen in a quiet European morning session. EUR/USD moved around 10 pips firmer to 1.1135, despite a weaker than expected German ZEW survey. This showed the current conditions index hit its lowest since the pandemic while the economic sentiment index fell sharply to its lowest level this year, but there was little FX reaction.

Otherwise, AUD/USD also gained a little ground to 0.6765, and GBP/USD gained 10 pips to 1.3220. USD/JPY was little changed at 140.60.

Asia Session

The USD/JPY spike to 141.24 in early Asia did not last and has since reversed traction. The up move seems to be triggered by Suzuki's verbal intervention towards the recent JPY strength. Furthermore, he said he is analyzing the impact of the strengthening yen. USD/JPY is back to unchanged at 140.61 after early volatility by Asia noon. The market seems to be agreeing with our view that the BoJ is not going to change rates in the coming meeting as we see U.S. Treasury Yields are higher across the curve while JGB yield slide.

Regional sentiment is mixed on Tuesday Asia so far with HSI in the green and Japanese equity indexes in the red. As China is still observing its holiday, major FX pairs are range bounded except for the JPY. AUD/USD is down 0.13% to 0.6743, NZD/USD is down 0.2% to 0.6189 while USD/CAD rose 0.07%. Else, EUR/USD is down 0.08% and GBP/USD is down 0.12%.