China is likely to continue tolerating a weaker currency, but that’s unlikely to trigger another round of global financial market turmoil, say analysts at Goldman Sachs.
Economic data shows an improvement but nothing to write home about. Civil unrest, economic gloom, and unprecedented unemployment must be a concern…
There is a laser-precision technique that tells us whether the precious metals market is going to move higher or lower, and it could take form of a …
Early in the summer of 2020, the British Pound is slowly growing against the USD, which is quite good after a depressing previous week. At the beginning of June, GBP/USD is mostly trading at 1.2403.
(Bloomberg) -- Barely a fortnight ago, currency traders were fretting over the future of the euro. They’re now cautiously optimistic.The common currency just had this year’s best monthly advance after the European Union finally managed to assemble a stimulus plan to steer the region’s recovery from the pandemic. Option-market sentiment is improving and strategists are beginning to relay a glimmer of optimism on the euro’s prospects.The median euro-dollar forecast for third quarter edged up in May, the first positive change this year, according to a Bloomberg survey. HSBC Holdings Plc lifted its year-end call to $1.10 last week, from $1.05 previously, with strategists saying in a note that the “existential tail risk of a euro-zone breakup” has now fallen.”We have turned cautiously bullish over the last week or so,” said Lee Hardman, a currency strategist at MUFG in London. “Building evidence that the euro-zone economy is through the worst of the Covid-19 crisis and EU Recovery Fund proposals have helped to ease downside risks for the euro, and created a firmer foundation for the rebound to extend from still-undervalued levels.”In addition to the recovery fund, Germany is preparing a second phase of stimulus of between 50 billion euros ($56 billion) and 100 billion euros, which would help boost sentiment in the euro. And also, measures of manufacturing activity in the euro-area suggest the European nations may be on the road to recovery.The euro rose 0.3% to $1.1140 Monday, advancing for the fifth straight day in the longest winning streak since March. Its 1.3% advance in May was the biggest monthly gain since December. The end-September forecast in the Bloomberg survey climbed to $1.10 from a low of $1.09 in May.Option SignalThe option market is mirroring the brightening mood. One-month euro-dollar risk reversals, a gauge of positioning and sentiment, convincingly broke above zero last week for the first time in months, signaling a bullish turn in sentiment toward the common currency.To be sure, there are still uncertainties weighing on the euro. The European Central Bank’s policy decision on Thursday is one, but more importantly, focus is on the June 19 meeting of European leaders to weigh the stimulus proposal, which still needs the go-ahead from the likes of Austria and the Netherlands.Nevertheless. the view that the worst is behind the euro has gained some ground.In the “short-term, the euro could test the top of the $1.08-$1.12 trading rage it has been in since last summer,” MUFG’s Lee said. “If it can break above, things would get more exciting, otherwise it remains a hard grind higher for now.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
European stocks rallied on Monday as a lack of escalation in U.S.-China tensions put the focus back on reopening of the world’s economies.
Gold has been strong recently on the heels of Coronavirus fears, Federal Reserve stimulus packages, and continued geopolitical tensions, which are now being exacerbated by the George Floyd riots in the United States.
Risk appetite weighs on the Greenback early. PMI numbers and geopolitics will be key drivers on the day, however.
It’s a bullish start to the day. Failure to move through key levels could see support levels come into play, however.
Posted by OFX AUD - Australian Dollar The Aussie dollar rose against the USD last trading session to open at 0.6669 gaining some traction after a speech by President Trump about China early Saturday morning. The US President has stated that the United States will move to sanction Chinese officials over what … Continue reading "AUD sees a rise following President Trump’s speech"The post AUD sees a rise following President Trump’s speech appeared first on .
Without a plunge in demand for risky assets and another dip in Treasury yields, gold is going to have a hard time rallying significantly.
The RBA is expected to leave its benchmark interest rate at 0.25%. We’re also looking for policymakers to leave monetary policy measures intact.
Friday’s closing price reversal top was impressive, but it won’t mean anything unless there is a follow-through rally.
The NZD/USD is in no position to change the main trend to down, but there is room for a near-term correction into .6074.
Watch trader reaction to $1744.10 to $1754.30 early next week. This should tell us if buyers have returned or if sellers are taking control.
The direction of the EUR/USD the rest of the session on Monday is likely to be determined by trader reaction to Friday’s close at 1.1108.
GBP/USD recovered higher last week on the back of a broadly weaker dollar but is seen approaching an important technical resistance level.
EUR/USD shows strength in the early day although the pair faces resistance from an area that triggered a notable turn in late April.
As we already know, I was a bit bullish on the GBP crosses, mostly on the GBP/USD. We can see that the first target has been reached. Continuation is possible.
The European Commission (EC)’s ambitious proposal is a critical step in the right direction to contribute to an even and sustainable economic recovery across the EU-27. Still, major hurdles lie ahead, and various open questions remain.
EUR/USD is showing strong bullish momentum after breaking the resistance zone (dotte orange). A bullish ABC pattern is taking place. Price could aim for 1.11280.
Unless U.S. yields or JGB yields spike unexpectedly in either direction, I’m anticipating another week of rangebound trading.