North American Summary and Highlights 9 July
Overview - The USD made modest gains on Powell’s testimony, though he provided few surprises.
North American session
Focus was on Fed Chairman Powell’s testimony to the Senate, in which he said that more good inflation data was needed before easing, and saw risks both from easing too soon or by too much, or too late or too little. While he also said the labor market was not overheated, yields edged higher, particularly at the long end, giving modest support to the USD.
USD/JPY rose from near 160 to briefly hit 161.50 before returning to 161.30. EUR/USD saw only marginal slippage with 1.08 holding. EUR advanced versus GBP but slipped versus the CHF. AUD and CAD saw little change versus the USD, and in late trade saw marginal gains as the USD came off its highs.
European morning session
The USD was generally a little firmer through a quiet European morning, EUR/USD losing around 10 pips to 1.0820 and USD/JPY gaining 20 pips to trade above 161. GBP was little changed against the USD. EUR/SEK fell back 3 figures, reversing some of the sharp rise seen on Monday.
There was no European data of any note but we did see the latest US NFIB survey at the end of the morning, which was stronger than expected, recovering recent declines to reach the highest level this year.