Psychology for major markets August 13th

EUR/USD – EUR/USD holding close to 1.09. Underlying tone remains neutral.

USD/JPY – USD/JPY corrected higher helped by mildly dovish comments from BoJ deputy governor Uchida. But levels near 150 likely to be hard to break, and bigger picture risks on the downside.

EUR/GBP – Softer after unexpected drop in UK unemployment rate but progress below 0.85 unlikely unless UK CPI data proves stronger than expected.

AUD/USD – AUD found some support below 0.64 and has extended gains above 0.66 as risk sentiment stabilises. Further upside scope exists if risk sentiment continues to improve.

Equities – Slumped after softer US employment data, helped by unwinding of JPY funded risk positions, but is recovering modestly. High US valuations limit the scope for recovery despite sharp yield declines.