North American Summary and Highlights 10 August
Overview - Oil and UST yields picked as did USD/JPY though USD moves were modest elsewhere.
North American session
In an absence of significant data, the USD continued to correct Friday’s slide with fading hopes for a deal to reopen the Strait of Hormuz lifting oil prices and US data focus turning towards Wednesday’s CPI. Fed’s Hammack was hawkish in late comments, suggesting multiple rate hikes may be needed.
UST yields were higher, and USD/JPY moved above 159.25, well above Friday’s pre-payroll levels. Elsewhere however moves were modest. EUR/USD fell to near 1.1540 from 1.1550 as EUR/JPY advanced to near 184. EUR/GBP slipped to near .8540 from .8560 while EUR/CHF edged up to .9350 from .9340. USD/CAD and AUD/USD were quiet, near 1.3940 and .7060 respectively, sustaining Friday’s moves.
European session
Extension of the overnight moves with USD/JPY and yen crosses still attempting to correct higher and backfill on the recent post intervention basing out. Slight extra pop as USD/JPY clears the Thu-Fri highs, extends another 25 pips. Technical driven trade with oversold lift towards 159~ being attempted. Otherwise, relatively quiet for news. Still waiting on Iran deal news, but with Iran still looking to muscle on maximum US concessions.
Norway Jul CPI data comes in a bit higher on the headline, at 3% from 2.7% (mkt 2.8%) but a little softer on the core, flat at 2.7% vs 2.8% market and below Norges’ expectations. Latter helps NOK a touch softer but main focus still on oil and risk backdrop. EZ July Sentix index into positive at 0.9 vs -0.5 mkt and -3.1 previous.