Europe Summary and Highlights 5 February
The USD was generally weaker through the European morning.
European morning session
The USD was generally weaker through the European morning. USD/JPY lost half a figure to 152.80, while EUR/USD gained around 20 pips to trade above 1.04. Other currencies outperformed the EUR, generally gaining around 0.3-0.4%.
The session was relatively quiet newswise. The final European PMI data saw the Eurozone composite index unrevised at 50.2 while the UK index was revised slightly lower to 50.6. Eurozone PPI was marginally weaker than expected at 0.4% m/m. French industrial production was also weaker than expected, falling 0.4% m/m in December.
Asia session
The Japan Overall Labour Cash Earnings for December 2024 is a huge beat at +4.8% y/y, a big jump from 3% in November 2024. It seems to suggest the change in stance from the BoJ members towards supportive of a hike in January. If the trend of wage growth continues in 2025, we may see more BoJ hikes. USD/JPY slipped 0.57% to 153.44 as U.S. Treasury underperformed JGB in yield.
Major equity indexes remain in the red as outlook is not bright with concern about further action from Trump in the geopolitical front. The Chinese equity market returned from the Lunar New Year holiday to open higher but reversed from the opening gap as session progress. AUD/USD is down 0.09% to 0.6249, NZD/USD is up 0.1% and USD/CAD rose 0.12% along soft oil. Else, EUR/USD is down 0.02% and GBP/USD is down 0.11%.