Global Markets:
- Asian stock markets: Nikkei down 0.10 %, Shanghai Composite lost 0.15 %, Hang Seng rose 0.05 %, ASX 200 rallied 0.90 %
- Commodities: Gold at $1255 (+0.10 %), Silver at $16.45 (+0.05 %), WTI Oil at $46.60 (+0.60 %), Brent Oil at $48.90 (+0.55 %)
- Rates: US 10-year yield at 2.25, UK 10-year yield at 1.19, German 10-year yield at 0.51
News & Data:
- Dollar recovers from 13-month low on strong PMI readings, Asia stocks tread water – RTRS
Markets Update:
The US Dollar recovered slightly yesterday, following stronger than expected US economic data. However, the currency quickly lost momentum and came again under pressure in Asia.
EUR/USD bounced off 1.1620 support and is heading again towards 1.17. The Euro remained well bid despite the disappointing PMI numbers out of the Euro Zone countries, which shows that demand is still high.
GBP/USD rose from 1.3015 to 1.3035 in Asia. The Pound is likely to struggle in the near-term amid uncertainty around Brexit and a reluctant Bank of England. Heavy resistance is seen in the area between 1.31 and 1.3120.
USD/JPY is testing 111 support again, and the outlook is negative. A test of 110 should follow soon, and downside momentum will increase should the pair break below that level.
AUD demand remains strong. AUD/USD bounced ahead of 0.79 and reached a high of 0.7945 in Asia. The pair should test 0.80 soon, and a break above that level would then signal an extension of the rally to 0.82. The main risk for the AUD rally are the inflation numbers which will be released on Wednesday. Disappointing figures could put the Australian Dollar under some pressure, although losses are likely to be limited to 0.7840.
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