FX Market Update 19-6

Market Briefs
EUR/USD -0.64%, USD/JPY -0.59%, GBP/USD -0.6%, EUR/GBP flat
DXY 0.41%, DAX -1.26%, FTSE -0.42%, Brent -0.42%, Gold 0.11%
ECB patient and gradual with rate hikes, Draghi says
EU Current Account NSA,EUR, 26.2 bln, 40.6 bln prev
EU Current Account SA, EUR, 28.4 bln, 32 bln prev
China slams U.S. “blackmailing” as Trump issues new trade threat
Germany’s Ifo sees euro crisis 2.0, trade war slashing growth
Japan steel lobby fears US-China spat may prompt global trade order ‘collapse’
N.Korea’s Kim visits Beijing; S.Korea, U.S. halt military drill
Flexible wage setting may increase inequality, researchers tell ECB
White House defends immigration policy as outrage grows over children
OPEC sees strong oil market, possible need for more output
Gold prices gain as U.S.-China trade spat stokes safe-haven buying
Oil falls as flaring U.S.-China trade dispute blunts risk appetite

Looking Ahead – Economic Data (GMT) 
12:30 US Housing Starts Number, 1.310 mln f’cast, 1.287 mln prev
12:30 US Build Permits: Change MM, -0.9% prev
12:30 US Building Permits: Number, 1.350 mln f’cast, 1.364 mln prev
12:30 US House Starts MM: Change, -3.7% prev
12:55 US Redbook YY, 4.3% prev

Looking Ahead – Events, Other Releases (GMT) 
N/A ECB President Draghi, chief economist Praet, St Louis Fed President Bullard and Central Bank of Ireland chief Lane speak in Sintra, Portugal
11:00 ECB chief economist Peter Praet chairs a session in Sintra, Portugal
11:00 Federal Reserve Bank of St. Louis President James Bullard speaks in Sintra, Portugal
13:00 ECB bank supervisory chief Daniele Nouy speaks in Brussels
23:50 BoJ releases Minutes of Monetary Policy Meeting held on Apr 26 and 27

Commentary and Analysis

Trigger of stops below 1.1500 EUR/USD barriers are likely
Massive EUR/JPY selling has folowed the rise in U.S/China trade tensions
EUR/JPY -1.3% to 126.67. Break May 31 low 126.34 risks 29/30 lows 124.62/98
Long-term supports @ 100-WMA 125.59 and weekly cloud base 125.19
Large stops below 1.1500 barrier at risk due to the limited EUR/USD rebound
Shrinking c/a surplus and patient Draghi also weigh EUR
Sub 1.1500 exposes major fib @ 1.1448. Big 1.1450 options are a certainty

USD/JPY biggest one-hour drop since May 24, risk-off reigns
Trump’s new threat triggered biggest one-day slide in USD/JPY since May 24
Risk aversion swept through FX, USD/JPY bias remains squarely on downside
Spot has dropped from Asia’s 110.58 high to reach 109.55 low in Ldn so far
USD/JPY propped by Fibo after biggest one-hour fall in June
10-yr UST-JGB spread narrows as USD/JPY drops, 30/60-day correlations high
Large USD/JPY expiry for Tue June 19 below 109.00

Sterling ship is listing ahead of Brexit showdown
1.3168 = seven-month low for GBP/USD after stops tripped on 1.3200 break
Risk aversion on US/China trade conflict & Brexit concerns weighing on pair
USD occupies a higher rung of the safe-haven currency ladder than GBP
Brexit showdown in Commons Wednesday
GBP/USD bear targets include 1.3100, 1.3040 (Nov low) and 1.3000
1.3200 (former support point) is now a resistance level (1.3205 was May low)

AUD/USD down to 13mth low as Trump raises trade war stakes
Risk-sensitive AUD continues to suffer after US/China trade war stakes upped
AUD/USD down to 0.7361 (13mth low) since European open
0.7394 was Asia low (0.7427 = ensuing rally high). Nikkei closed down 1.77%
London copper down 1.65% to 18-day low. Dalian iron ore down 5%
Scope for further AUD/USD losses if US/China trade war escalates further
0.7160 (Dec 2016 low) and 0.70 among bear targets (0.6827 = Jan 2016 low)

GBP longs on edge as Brexit showdown clock ticks
Speculators who are long sterling may be in for additional pain as the clock ticks towards Wednesday’s Brexit showdown in the House of Commons. If PM May fails to dig out a compromise with Tory pro-EU rebel MPs within the next 32 hours and loses the mid-week vote it could spur further GBP losses on fears the UK government might collapse. Leading pro-EU Tory MP Grieve today said he did not want the government to collapse in the row over parliament’s role in the Brexit process. Nevertheless, Ladbrokes quotes 5/1 for May to no longer be PM by month-end versus 10/1 a fortnight ago. Tripped stops have helped depress GBP/USD to a seven-month low of 1.3168 today, following its break below 1.3200, with risk aversion and Brexit concerns helping to weigh on the pound. On Monday, a Goldman Sachs strategist said the “fair value” of GBP/USD is around 1.26.

Trump worsens Swiss c.bank’s FX headache as MPA looms
The spectre of a global trade war and political events are conspiring against the Swiss central bank’s desire for a weaker franc as Thursday’s quarterly SNB monetary policy assessment looms. EUR/CHF has fallen to a June low of 1.1492 today on demand for the safe-haven franc after President Trump ratcheted up the U.S. trade conflict with China. The cross had traded north of 1.1500 since June 1 (until today), after slumping to eight-month low of 1.1370 in late May as Italian political turmoil spurred buying of the CHF. Although the Italian political situation is now a lot calmer, the Swiss government remains concerned–issuing a warning today about the possibility of “considerable upward pressure” on the CHF. If events increase the allure of the franc, it could also prompt IMM speculators to jettison more of their short CHF positions–which dwarfed CHF longs by nearly four to one in the week to June 12 (50,265 contracts vs 13,020

FX Market Update 18-6

Market Briefs
EUR/USD -0.03%, USD/JPY -0.14%, GBP/USD -0.21%, EUR/GBP 0.21%
DXY 0.02%, DAX -1.23%, FTSE -0.31%, Brent 0.97%, Gold 0.15%
IT Trade Balance EU, 1.077 bln, 0.698 bln prev
IT Global Trade Balance, 2.938 bln, 4.531 bln prev
British PM’s Brexit plans set for Lords defeat, teeing up showdown
UK households see fastest income growth in at least 9 years – IHS Markit
China’s c.bank says bond market risks in check as it steps up monitoring
Gold steady as strong dollar counters concerns over U.S.-China trade spat
Oil down on China tariffs, expected OPEC supply rise
Magnitude 6.1 quake in Japan’s Osaka area kills three, stops factories

Looking Ahead – Economic Data (GMT)
14:00 US NAHB Housing Market Indx, 70 f’cast, 70 prev

Looking Ahead – Events, Other Releases (GMT)
N/A John Williams begins tenure as president of the Federal Reserve Bank of New York
12:35 Retiring Federal Reserve Bank of New York President William Dudley speaks in New York
16:45 Speech by Bank of Canada Deputy Governor Lynn Patterson in Toronto
17:00 Federal Reserve Bank of Atlanta President Raphael Bostic speaks in Georgia state
19:00 ECB President Mario Draghi speaks in Sintra, Portugal
20:00 Incoming Federal Reserve Bank of New York President John Williams speaks in New York

Commentary and Analysis

Wobbly stocks underpin EUR/USD but topside looks limited 
Many factors conspire against the euro but risk-off markets underpin today
Longs, carry trades, CNY, CB flows and techs weigh EUR/USD
China equities slide close key 3K mark, DAX off 1.1%, E-mini down 0.5%
After another low shy 1.1500 option barriers spurs a little short-covering
Resistance @ 38.2% retracement sell-off since ECB @ 1.1661. 21-DMA 1.1699
USD strength will lead to CB rebalancing, so selling EUR/USD strength

USD/JPY shorts on edge after 5th biggest 2018 one-week gain 
USD/JPY shorts caught after last week’s 5th biggest one-week rise of 2018
Bulls little fazed by trade tensions, eye 111.00, stops above
IMM data for week ending June 12: Equivalent USD/JPY 572M short position
There has been net selling of USD/JPY on the EBS since June 12
Spot retains slight bullish slant, support at tenkan line
Monday’s range has been 110.30-75, bids all the way down to 110, stops below

GBP/USD down before expected May loss on Brexit in Lords )
Cable down 38 pips to 1.3236 intra-day low since the European open
Weakness precedes expected Brexit vote loss for UK govt in Lords today
Key Commons vote on Wednesday
Cable bids tipped pre-1.3200 option barrier level. 1.3205 = May 29, 6mth low
1.3212 was Friday’s low. Big 1.3205 option expiry Thursday, GBP 766mn strike
BoE MPA Thursday: 7-2 rate hold vote f/c, pre-Carney MH speech

AUD/USD remains on the defensive on global trade tensions 
Risk-sensitive AUD remains under pressure on US-China trade tensions
0.7426 was six-week low for AUD/USD early Asia
0.7455 = subsequent high (during European am). 0.7475 resistance beyond
Large 0.7475 option expiries Tuesday and Wednesday, A$2.49bln strikes
0.7413 (May 9 low) support. Copper down to two-week low
M&A news: South32 bids $1.3bln for rest of Arizona Mining

Brexit vote may torpedo GBP/USD pre-BoE decision
Cable could slide towards 1.3000 on the back of UK political uncertainty if the UK government loses a crucial Brexit vote in the Commons on Wednesday, on the eve of a BoE meeting widely expected to keep rates on hold. The vote will also take place just over a week before an EU summit where Brexit will be discussed. On Sunday, leading pro-EU Tory MP Grieve warned that a row over parliament’s influence over the Brexit process could collapse the government (Full Story). GBP/USD broke below 1.3300 last Thursday after pro-EU Tory MPs including Grieve said May had offered them much less than they were expecting in a new amendment setting out parliament’s role in shaping Brexit. Wednesday’s key Commons vote will be teed up by an expected defeat for the government over its Brexit plans in the Lords today (Full Story). IMM speculators have held more long GBP positions than shorts for six months: some stops on cable longs will be sheltering under 1.3200 (option barrier level), and these could help generate downward momentum towards 1.3000 if tripped.

USD/JPY bulls little fazed by trade tensions, eye 111
USD/JPY remains on course to break above 111.00 with bulls little fazed by the escalation on Friday in U.S-China trade tensions because the new tariffs imposed were broadly expected. The U.S decided to slap tariffs on $50 billion worth of Chinese goods (Full Story) and this was met with an announcement by China that it would impose 25% tariffs on 659 U.S. products (Full Story). The doji on Friday’s USD/JPY candlestick line — where the market closed very close to where it opened — reflected market indecision as U.S-China tensions came into sharp focus again. However, as spot marginally took out Wednesday’s 110.85 high on Friday, the market retains a slight bullish tilt. More immediate support has built up ahead of the 110.25 Fibo — 23.6% retrace of the 108.12 to 110.90 (May to June) recovery. As the tenkan and kijun lines are positively aligned, this reinforces the underlying bullish structure. A further ratcheting up of the trade dispute this week could, however, knock USD/JPY bulls off their stride.

Futuro del peso mexicano 18-6

Several EM central banks meet this week.  The brewing trade war provides a poor global backdrop for EM.  Brazil, Mexico, and the Philippines are expected to hike rates in support of their respective currencies.  Failure to do so would likely lead to sharp losses.  Hungary is starting to get concerned about forint weakness but is not expected to move this week.  Taiwan and Thailand are in the fortunate camp where currency weakness and inflationary pressures are limited, and so are in no hurry to hike rates this week.
Banco de Mexico meets Thursday and is expected to hike rates 25 bp to 7.75%. Mexico reports mid-June CPI Friday, which is expected to rise 4.59% y/y vs. 4.46% in mid-May.  If so, inflation would continue moving away from the 2-4% target range after several months of heading towards it.
476= 100 HMA
478.60= 200 HMA
Futuro del peso mexicano 18 - 6

FX Market Update 15-6

Market Briefs
• EUR/USD 0.12%, USD/JPY -0.08%, GBP/USD 0.07%, EUR/GBP -0.01%
• DXY 0.14%, DAX -0.24%, FTSE -0.73%, Brent -1.25%, Gold -0.28%
• EU HICP Final YY, 1.9%, 1.9% f’cast, 1.9% prev
• EU HICP ex F&E YY, 1.3%, 1.3% f’cast, 1.3% prev
• EU Labour Costs YY, 2%, 1.5% prev
• DE Wholesale Price Index YY, 2.9%, 1.4% prev
• IT CPI (EU Norm) Final YY, 1%, 1.1% f’cast, 1.1% prev
• IT Industrial Orders YY NSA, 6.4%, 2.6% prev
• IT Industrial Sales YY WDA, 4%, 3.6% prev
• IT Consumer Prices Final YY, 1%, 1.1% f’cast, 1.1% prev
• Japan’s central bank cuts inflation view, narrowing stimulus-exit path
• China promises fast response as Trump readies tariffs
• Former Trump campaign chief Manafort to ask judge not to jail him
• Bundesbank slashes Germany growth view, says horizon clouded
• Gold slips on stronger dollar; U.S.-China trade war fears loom
• Oil falls as focus moves to prospect of higher supply

Looking Ahead – Economic Data (GMT) 
• 12:30 US NY Fed Manufacturing, 19% f’cast, 20.1 prev
• 12:30 CA Manufacturing Sales MM, 0.6% f’cast, 1.4% prev
• 12:30 CA Securities Cdns C$, -1.90 bln
• 13:15 US Industrial Production MM, 0.2% f’csat, 0.7% prev
• 13:15 US Capacity Utlization MM, 78.1% f’cast, 78% prev
• 14:00 US U Mich Sentiment Prelim, 98.5 f’cast, 98 prev
• 14:30 US ECRI Weekly Index, 148.7 prev
• 14:30 US ECRI Weekly Annualized, 2.6% prev

Looking Ahead – Events, Other Releases (GMT) 
• 17:30 Fed’s Kaplan speaks in Texas

Commentary and Analysis

EUR/USD off lows on profit-taking, surging labour costs 
• EUR/USD 1.1543-1.1615 rise in Europe
• Recovery largely due to the big extent of ECB inspired decline from 1.1853
• Clear need for a correction with 1.1661 38.2% of the fall seen last 24 hours
• EZ labour costs also surged to 2% way over 1.4% f/c and highest since 2011
• So soon after the ECB and coupled weaker euro will challenge H2 2019 view
• However, huge EUR/USD longs at risk to hawkish Fed, prospect wider rate gap
• Key support @ 1.1448 50% 1.0340-1.2556 rise and 100/200-WMAs 1.1426/16

USD/JPY bulls halted after June’s 2nd biggest one-hour drop
• USD/JPY had been making good progress, but gains have been halted in London
• Friday sees 110.90 to 110.39 drop in London, as near-term bulls buckle
• Also 2nd biggest one-hour drop of June so far (open 110.76, close 110.52)
• Bulls staged resolute fight back to register close above Fibo
• BoJ stands pat as eyed, that caused USD/JPY to rise
• BoJ Gov Kuroda: Growth moderate, to stick to current policy

GBP/USD helped off 17-day low by profit-taking on shorts 
• GBP elicited support pre-1.3200/05 after breaking below 1.3229
• Subsequent rise to threaten 1.3300 aided by some profit-taking on shorts
• 1.3300 is a former support level. 1.3301 = 38.2% of 1.3446-1.3212
• 1.3446 = Thursday high on UK retail sales beat, pre-dovish ECB rate guidance
• 1.3205 was six-month low on May 29. 1.3200 is an option barrier level
• Large 1.3250 option expiry for 10am ET NY cut (1400GMT), GBP 967mn strike

AUD/USD remains under pressure on US/China trade concerns
• Global trade concerns continue to weigh on the risk-sensitive AUD
• Trump is expected to unveil revised China tariff list today
• China promises fast response as Trump readies tariffs
• AUD/USD revisited 0.7454 (Asia one-month low) in early European trade
• Subsequent climb to 0.7480 aided by some profit-taking on short positions
• AUD/USD fell by 1.4% Thursday, its steepest one-day decline since Feb 2

GBP braces for another long week of Brexit politics 
Sterling will once again be at the mercy of Brexit politics next week, with a House of Commons debate on finalising Brexit laws scheduled for Wednesday (June 20). GBP/USD broke below the 1.3300 level for the first time since May 29 on Thursday after pro-EU MPs in the Tory Party said PM May had offered them much less than they were expecting in a new amendment setting out parliament’s role in shaping Brexit. The pound’s fall came 48 hours after it caught a bid when the same group of pro-EU Tory MPs backed the government in a key Commons vote on shaping Brexit, on expected concessions. With the bad blood between May and her europhile backbenchers getting worse, a rebellion can’t be ruled out. Indeed, Ladbrokes has shortened the odds of May no longer being PM at month-end to 5/1, from 6/1 Tuesday and 10/1 last week. Sterling will take a knee-jerk hit if May faces a Tory leadership challenge or unexpectedly resigns.

German politics add to euro’s travails after ECB hit 
A threat to the survival of Germany’s CDU-CSU/SPD coalition government adds to the euro’s woes after the single currency’s steep slide on the back of the ECB’s dovish rate guidance Thursday. Chancellor Merkel (CDU) has so far failed to placate leaders of the CDU’s Bavarian sister party in a dispute over migrant policy ahead of a Bavarian regional election in October, with the CSU to decide on further steps at a meeting on Monday. If the dispute cannot be settled, Merkel may be forced to sack her CSU Interior Minister Seehofer. This would trigger a German government crisis which could spur further liquidation of long EUR positions. IMM speculators upped gross EUR long positions by 9% in the three weeks to June 5–a period which encompassed Italian political turmoil, to help maintain a hefty gap over gross EUR shorts . Some of those euro longs may be jettisoned if EUR/USD breaks below 1.1500 (option barrier level). 1.1510 was the 10-month low on May 29, at the height of Italian political turmoil

Futuro del peso mexicano 15-6

Dollar Slips While Escalating Trade Tensions May Roil Markets

  • Market attention shifts from central banks to trade tensions
  • The growth trajectories of the two largest economies are diverging
  • Investors are still struggling to make sense of this week’s central bank meetings
  • The yen is stronger even though the BOJ lefts rates on hold and downgraded its inflation assessment
  • Central Bank of Russia is likely to keep rates steady at 7.25%
  • The massive amount BRL swaps being issued will likely have negative consequences
  • COP should start to suffer more due to rising political risks
50 HMA= 474.90
100 HMA= 476.50
Futuro del peso mexicano 15 - 6

Futuro del peso mexicano 13-6

The May Producer Price Indices for final demand were firmer than expected, with the all-items index (mkt +0.3% m/m, +2.8% y/y) up 0.5% m/m and 3.1% y/y, while the ex-food and fuels index (mkt +0.2% m/m, +2.3% y/y) rose 0.3% m/m to reach +2.4% y/y. Our preferred core measure (ex-food/fuels/trade), however, ticked up just 0.1%, so take the previous data with a grain of salt.

50 HMA= 484.80
100 HMA= 486.80
Futuro del peso mexicano 13 - 6

FX Market Update 12-6

Market Briefs
• EUR/USD 0.11%, USD/JPY 0.11%, GBP/USD 0.17%, EUR/GBP -0.06%
• DXY -0.06%, DAX -0.14%, FTSE -0.4%, Brent 0.39%, Gold -0.12%
• Trump, Kim agree on denuclearisation, but deal seen symbolic
• China suggests N.Korea sanctions relief as Trump, Kim meet
• DE ZEW Economic Sentiment, -16.1, 14 f’cast, -8.2 prev
• DE ZEW Current Conditions, 80.6, 85 f’cast, 87.4 prev
• German upswing remains robust despite U.S. tariff threat -OECD
• GB Claimant Count Unem Chng, -7.7k, 31.2k prev
• GB ILO Unemployment Rate, 4.2%, 4.2% f’cast, 4.2% prev
• GB Employment Change, 146k, 110k f’cast, 197k prev
• GB Avg Wk Earnings 3M YY, 2.5%, 2.6% f’cast, 2.6% prev
• FR Non-Farm Payrolls Rev, 0.20%, 0.30% prev
• OPEC will squeeze oil buffer to historic lows with an output hike
• In Brexit showdown, British PM May faces issue of “meaningful vote”
• With rate hike in the bag, focus turns to Fed’s policy language
• Gold dips on strong dollar post Trump-Kim meeting; Fed in focus
• Oil edges up, but bulls remain wary ahead of OPEC meeting

Looking Ahead – Economic Data (GMT)
• 12:30 US Core CPI YY, NSA, 2.2% f’cast, 2.1% prev
• 12:30 US CPI YY, NSA, 2.7% f’cast, 2.5% prev
• 12:55 US Redbook YY, 4% prev

Looking Ahead – Events, Other Releases (GMT) 
• N/A U.S. Federal Reserve’s Federal Open Market Committee starts in Washington
• 14:00 Senate Committee votes on the nominations of Richard Clarida to be Fed vice chairman and Michelle Bowman to be a member of the Fed Board of Governors in Washington

Commentaries and Analyses

EUR/USD up in Europe as rates lend the euro a hand (nL1N1TE0AO) 
• EUR/USD soft in Asia trading lower within a 1.1803-1.1741 range
• Pair supported in Europe rising 1.1757-1.1809
• Interest rate mkts ahead FED/ECB shift in support of a higher EUR/USD
• US/German 10-year spread narrows to 245bp, tightening by 14bp since end-May
• Further 1bp tightening would take spread to narrowest since mid-May
• EUR 8 shorts estab since start May. Break 1.1840 or 1.1700 will excite

USD/JPY, sold in Ldn after US-NK summit, vulnerable to squeeze (nL1N1TE0AM)
• USD/JPY selling in late Asia, throughout Ldn could see short squeeze from NY
• Few details on how NK denuclearisation will be achieved weighs on USD/JPY
• USD/JPY rose from 110.00 to hit 110.49 in Asia, ahead of the easing in Ldn
• Bulls had earlier leapt over 200-DMA to focus on key Fibo
• Japanese exporter offers said to be in size at 110.50 and above
• Widening UST-JGB spread underpin USD/JPY bulls ahead of Fed

GBP/USD reclaims 1.34 handle after dip on UK earnings miss (nL1N1TE095) 
• Cable fell to 1.3380 in knee-jerk reaction to below f/c UK earnings data
• Headline earnings +2.5%, ex-bonus earnings +2.8%, both 0.1% below f/c
• Larger than expected rise in employment is silver lining for GBP bulls
• 146k vs 110k f/c. ILO jobless rate 4.2%, as expected
• Rally from 1.3380 topped out a pip shy of 1.3419 (pre-UK data high)
• 1.3343 was early Europe one-week low. 1.3345-1.3441 was Monday’s range

AUD/USD elicits support from ‘positive’ Trump-Kim summit (nL1N1TE08R)
• Risk-sensitive AUD ticks up to 0.7623 vs USD after Trump/Kim summit
• Trump, Kim sign agreement but few specifics
• 0.7621 was Asia high and Monday’s high. 0.7627 was last Friday’s high
• Interim low between Monday’s high and Asia high was 0.7584
• AUD/USD could extend north if US CPI data softer than expected at 1230GMT
• US CPI f/c +0.2% MM, +2.7% YY. Core CPI f/c +0.2% MM, +2.2% YY

Higher USD yield, RBNZ to sap NZD/USD strength 

With U.S. interest rates about to become the highest of all in developed markets and risk appetite underpinned by the U.S.-North Korea agreement, the dollar is looking an attractive buy especially against the New Zeland dollar. A potentially dovish RBNZ at the end of the month and the fact that speculators are short of the greenback versus the kiwi may makes this the best dollar long play. This week the Fed Funds target is expected to rise to 2%, making the dollar’s yield the highest within developed FX markets and with stocks holding their long-term uptrends and vols in FX majors low, that big carry is going to attract a lot of demand. On the flip side, the new RBNZ Governor Orr struck a dovish tone at his first meeting on May 10 and with NZD/USD around 1% stronger than it was on May 10, the RBNZ is almost certainly going to repeat that dovish view on June 27. The 55-DMA at 0.7089 and daily Ichimoku cloud 0.7100-0.7175 provide strong resistance to sell against.

Widening UST-JGB spread spur USD/JPY bulls ahead of Fed  
The U.S. Federal Reserve is widely expected to raise interest rates for the second time this year, the focus is on whether the central bank will hint at raising rates a total of four times in 2018 which would spur USD/JPY gains. Meanwhile, the BoJ is widely to maintain its loose monetary policy on Friday. The 10-year UST-JGB yield spread will therefore likely remain a key influence over USD/JPY in coming days. The relationship (30-day log correlation) between USD/JPY and the UST/JGB spread since May 9 has been above +0.50, the threshold which means the two variables register a daily close in the same direction more often than not. Increased risk appetite in recent days in the run-up to today’s Trump-Kim summit, saw USD/JPY vault the 200-DMA at 110.19. Though Trump, Kim signed an agreement after the summit it had few details on how denuclearisation will be achieved, capping pressure on the safe-haven yen. If the 10-year UST-JGB yield spread continues to widen, this will help secure a USD/JPY bullish daily close above the 200-DMA.

Futuro del peso mexicano 12-6

US-Korea Summit Fails to Impress Investors

  • Investors appear largely unimpressed with the summit
  • With the G7 political theater behind us and the historic US-North Korean summit also over, attention returns to the macro situation
  • Redenomination risk in Italy continues to retract
  • The US reports May CPI figures today
  • USD/MXN is back above 20.50 and approaching the Friday high near 20.6550; India reports May CPI and April IP

50 HMA= 487.70

200 HMA= 493.50


Futuro del peso mexicano 12- 6