Europe Summary and Highlights 4 Aug

Europe 

A quiet morning, leaving the market consolidating with some backfilling on recent action after some oversold moves. USD/JPY still sitting back at Monday’s highs. AUD retains its slightly firmer tone overnight after data, risk tone broadly positive (copper +1.2%, Nasdaq +0.5%).

Oil also doing a bit of backfilling too, Brent nudging back into Monday’s gap (+$2.3) as the market waits to see if talks actually materialise and go anywhere after Iran’s denials and with shipping still difficult.  NOK a touch firmer.

Asia Session

Australia June household spending beats estimate at 0.8% m/m and seems to cement expectation of more RBA hikes. We are quite skeptical that RBA will hike further until the second round of energy spike materialize in the system. AUD/USD is trading 0.27% higher at 0.7020. Broader risk sentiment is upbeat except Japan and HK. NZD/USD is trading 0.12% lower while USD/CAD rises 0.03% with oil up more than a USD/B.

While joint intervention risk is putting a lid on USD/JPY strength, the pair is retesting Monday's high as fundamental picture did not change. USD/JPY is trading 0.27% higher at 157.57. JGB yields stays higher across the curve. Else, EUR/USD is unchanged and GBP/USD is down 0.09%.