Kantox currency update: euro and pound retreat against a firmer dollar
The dollar has remained bid over the last sessions, appreciating against a basket of the most traded currencies, buoyed by growing market confidence that the US and China might reach a trade deal, while after Trump’s State of the Union address, concluded without significant surprises.
The euro extended its recent downtrend on Tuesday, weighed by the weak Euro Zone data, while the pound sterling remains on the defensive with the investors increasingly wary about the consequences of a no-deal Brexit.
EUR/USD reversal extends below 1.1400. The euro continued trading lower against the US dollar and extends its pullback from last week highs at 1.1515 to levels below 1.1400. At London market opening times, the EUR/USD is trading at 1.1390
GBP/USD retreats below 1.3000. The pound accelerated its reversal from 1.3200 highs, after a weaker than expected UK services activity reading, to break below 1.3000 support area to hit two-week lows at 1.2925. At London market opening times, the GBP/USD is trading at 1.2930.
USD/JPY: testing 110.00 resistance area again. The dollar appreciated against the yen on Tuesday, buoyed by hopes of a US-China trade deal, to reach the top of the last week’s trading range, at 110.00. At London market opening times, the USD/JPY is trading at 117.85.
In the Calendar Today
In absence of relevant macroeconomic data, today, the German factory orders and U.S. non-farm productivity and the US trade balance might have a minor impact on currency volatility.
07:00 GMT EZ: German factory orders (MoM) (Dec)
Previous: -0.1% Expected: 0.3
13:30 GMT US: Trade Balance (Nov)
Previous: USD -55.5B Expected:USD -54.0B