Thursday 7th April 2022
Some hawkish tones from the Federal Reserve FOMC Minutes which noted that "many participants would have preferred a 50bps increase in the Fed Funds target range at this meeting" and we've seen some USD gains across the board again after some consolidation/profit taking yesterday albeit still ranging tightly for the most part.Markets have been pricing in multiple rate hikes but equally there are growing forecasts of recession to temper the gains.
Commodity currencies have suffered the most with AUDUSD falling through its 0.7520-40 pivot area and USDCAD up to 1.2570 after holding 1.2480 as oil retreats again on greater supply releases. Equities and gold both underpinned still too overall albeit off their latest highs again. Today Fed’s Bullard discusses the economy and mon pol at 14:00 BST, while the Fed’s Bostic and Evans discuss inclusive employment at 19:00 BST.
GBPUSD: Found a cap into 1.3110 this time and a retreat to test 1.3050 post-FOMC and some pips banked in the retreat again. I remain a rally seller overall while keeping an eye on EURGBP and GBPJPY as always. Further falls in EURGBP helping to underpin GBPUSD atm.EURGBP: A further retreat into 0.8315-20 after capping into 0.8350-60 again as he Euro remains under pressure. I would still expect some more dip demand down here but equally sellers poised in the bounce. Large EURUSD option interest today to keep an eye on too.
GBPJPY: Finding support at 161.50-60 again in the latest retreats but failing at 162.20-30 again so far amid the mixed risk tones.
EURUSD: Yesterday's failure around 1.0935 no great surprise givren the large option interest rolling off today up there that I've been highlighting on the options boards and equally we're seeing support around 1.0880 in the retreat as I type with large interest also nearby at 1.0900-10. USDJPY: Capping around 124.00 but Holding 123.45 in the latest retreats amid the general USD demand. EURJPY: Support at 134.50 being tested again now after a rapid retreat from 135.20 this morning as I type. USDCHF: Support coming in at 0.9315-20 now after failures into 0.9350 with the SNB probably giving a helping hand to help combat the generally softer EUR tones. EURCHF: Failures at 1.0190-200 sees a decent retreat to 1.0150 amid the general EUR supply but with the SNB lurking as sellers remain poised still.
AUDUSD: A cap at 0.7600 then 0.7580 saw a test of 0.7540 in the USD-demand/commodity ccy retreat and now broken to test 0.7475 with market caught long post-RBA. NZDUSD also saw its own retreat from 0.6970 but demand into 0.6890-00 holding the fall so far. USDCAD: 1.2480 now providing a base amid the firmer USD/softer oil double whammy but equally can't get back up through 1.2560-80 area so far. Two-way business still expected amid all the uncertainty. Options interest in play too.
Let's continue to be careful out there in all things. Staying safe must be our main priority still.
Interbank rates: 08.37 BST
GBPUSD 1.3098
EURUSD 1.0898
EURGBP 0.8320
GBPEUR 1.2017
GBPCAD 1.6435
GBPCHF 1.2205
GBPZAR 19.2515
GBPHKD 10.2049
USDJPY 123.80
EURJPY 134.93
EURCHF 1.0161
EURHKD 8.4900
AUDUSD 0.7489
USDCAD 1.2542
USDCHF 0.9323
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