Kantox currency update: euro surges on banking deal rumours
The euro has bounced sharply on Friday’s early trading, reaching fresh two-week highs against the US dollar, on the back of market speculation that the Japanese bank Mitsubishi UFG is planning to buy the aviation finance division of the German DZ Bank.
The dollar has pulled after a having appreciated sharply on Thursday, fuelled by a stronger than expected producer prices index, while the pound remains steady, with the market awaiting more concrete news about the Brexit.
EUR/USD bounces up to levels near 1.1300. The euro has bounced up from 1.1250 fuelled by the rumours of a cross-border deal between the German DZ Bank and the Japanese Mitsubishi Financial Group, which has boosted the pair to levels right below 1.1300. As at the London market opening times, the EUR/USD is trading at 1.1285.
GBP/USD steady below 1.3100. The pound has remained trading sideways, following the agreement to extend the Brexit deadline, trapped within a range from 1.3050 and 1.3110/20. As at London market opening times, the GBP/USD is trading at 1.3060.
USD/JPY surges to four-week highs near 112.00. The dollar bounced up strongly from 1.1085 lows on Wednesday after a strong US producer prices index reading, which has boosted expectations of an acceleration of the overall inflation and has pushed the dollar back to levels right below 1.1200. As at London market opening times, the USD/JPY is trading at 111.85.
In the Calendar Today
Today in Europe only the Eurozone industrial production is expected to show that factory output contracted in February. With the Eurozone showing signs of economic slowdown, a sharper than expected decline here might increase selling pressure on the euro.
In The US, the most relevant indicator will be the Michigan Consumer Sentiment Index, a survey of consumer confidence that might have a moderate impact on US dollar volatility.
09:00 GMT EZ: Industrial Production (MoM) (Feb)
Prev: 0.8% Cons: 0.2%
12:30 GMT US: Michigan Consumer Sentiment Index (Apr)
Prev: 98.4 Cons: 98.0