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Equity Rally Suppresses Haven FX

FOREX

US equity futures crested at new alltime highs Monday, with the e-mini S&P topping the highs last seen in late February. Equity gains came as US President Trump looked to accelerate the Coronavirus treatment in the US via plasma treatment and through fast-tracking a COVID vaccine being developed in the UK. This risk appetite hampered haven currencies, with CHF and JPY both trading poorly Monday.

GBP extended Friday's weakness, with GBP/USD inching below Friday's low of 1.3060. This leaves markets eyeing the Aug 12th low at 1.3005 for next support. The EU's chief negotiator Barnier is due to speak on Thursday, which will likely draw some focus.

CAD was an outlier, underperforming all others despite very little fundamental newsflow and positive crude oil prices. Nonetheless, USD/CAD's rally failed to take out the Friday high 1.3234, keeping the trend bearish for now.

Volumes and price action were generally muted across development markets, with market activity well below recent averages with few headlines or data catalysts to push prices in either directions.

German IFO data for August crosses Tuesday, with US new home sales and consumer confidence also due. The Republican National Convention continues, with the party due to set out their stall for another term in office

MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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