FX Brief Weaker Exports Weigh On Sentiment

FX Brief: Weaker Exports Weigh On Sentiment

Weak export numbers from Japan weighed on sentiment, with manufacturing confidence hitting a 3-year low. Treasuries and equity markets are lower, although contained remains contained overall.
Australian employment failed to light another match under rate-cut calls, supporting AUD during a slightly risk-off session. Unemployment remained steady at 5.2%, although RBA will need to see this lower over the coming months to justify recent cuts. Participation rate remained at record highs, although the headline employment figure missed the mark, coming in at 0.5k versus 10k expected down from -9.5k prior.
AUD, CHF and JPY are the strongest majors, USD and CAD are the weakest. AUD/CAD is the biggest gainer, with AUD receiving a tailwind with okay employment data and CAD pressured from trade concerns. USD/JPY is the biggest loser of the session, all pairs remain within their typical daily ranges although AUD/JPY is the closest to breaching it.

Up next:

UK retail sales is a volatile number at the best of times, and May’s figures were no exception with the YoY rate plummeting -2.8% with cool weather to blame. Shorting GBP is not a new idea and, given GBP/USD’s minor up day yesterday, perhaps it’s approaching a time for a contrarian move and may not take a huge beat to if GBP/USD further. Still GBP/USD is hovering just below key resistance around 1.244/78, so it could be reaching a pivotal moment.
US Initial jobless claims hit a 50-year low last month, but it may not be a main driver for the USD with markets expecting further easing from the Fed. USD is receiving safe haven flows and, whilst data overall isn’t great, it’s performing better than the rest of the world on a relative basis. Still, keep USD/JPY in focus as it is approaching 107.54 support.

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.