EUR/USD Rebounds Post First Election Round, Yen Underperformance Continues

EUR strength has been the main focus point in the first part of Monday trade. This has weighed on the BBDXY USD Index, which is down 0.10% to the low 1268.20/30 region.

• The single currency rallied early doors as Le Pen's far right party didn't poll as strongly as some opinion polls suggested in the first round of French parliamentary elections. Left leaning parties also vowed to bloc Le Pen's majority ambitions. EUR/USD is back to 1.0755, around 0.40% stronger for the session today.
• USD/JPY dips have been supported, the pair last just above 161.00. Friday highs (161.27) remain intact, but the yen remains weaker on crosses. CFTC positioning data showed an extension of yen shorts (we aren't too far away from 2024 lows). The Tankan survey data was mixed, albeit mostly positive for large firms and the Capex outlook, suggesting the BoJ can continue to adjust accommodative settings.
• AUD/USD is near 0.6665, underperforming modestly. Second tier data today hasn't shifted the sentiment needle. NZD/USD is a touch higher, last around 0.6100. Last week trades added to long NZD positions and cut AUD shorts (per CFTC).
• In the cross asset space, US equity futures were last up close to 0.3%. US yields are lower, led by the end of the curve. Iron ore has risen, amid positive China property news but with little benefit for the A$.
• Later US June manufacturing ISM/PMI, European PMIs and preliminary June German CPIs print. Also ECB President Lagarde speaks.