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FOREX: Greenback Off Highs, But Little Relief for USD/JPY

FOREX
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  • The greenback trades poorer against all others early Friday, keeping the USD Index pinned to the 50-dma and holding just below weekly highs. This has provided little relief for USD/JPY, however, which remains tilted higher and within reach of the post-intervention highs printed this week at 157.20. Clearance here keeps markets on watch, as the trade-weighted JPY index within just 1.5% of the pre-intervention lows.
  • GBP shrugged off the particularly poor retail sales release. April data showed sales fell 2.7% Y/Y and fell 2.3% on the month after a particularly poor bout of weather kept consumption subdued. The ONS noted "Sales volumes fell across most sectors, with clothing retailers, sports equipment, games and toys stores, and furniture stores doing badly as poor weather reduced footfall." This limited read-through for monetary policy, protecting GBP from any broad sell-off, although EUR/GBP sits again in minor positive territory.
  • Preliminary US durable goods orders are the data highlight Friday, although the final release of UMich sentiment for April will also be watched for any revisions to the sharp bump higher in inflation expectations as part of the preliminary release. Fed's Waller also is set to speak later today on rates, and with a text release, however his recent TV appearances and prepared statements should mean we hear little new on current policy. 
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  • The greenback trades poorer against all others early Friday, keeping the USD Index pinned to the 50-dma and holding just below weekly highs. This has provided little relief for USD/JPY, however, which remains tilted higher and within reach of the post-intervention highs printed this week at 157.20. Clearance here keeps markets on watch, as the trade-weighted JPY index within just 1.5% of the pre-intervention lows.
  • GBP shrugged off the particularly poor retail sales release. April data showed sales fell 2.7% Y/Y and fell 2.3% on the month after a particularly poor bout of weather kept consumption subdued. The ONS noted "Sales volumes fell across most sectors, with clothing retailers, sports equipment, games and toys stores, and furniture stores doing badly as poor weather reduced footfall." This limited read-through for monetary policy, protecting GBP from any broad sell-off, although EUR/GBP sits again in minor positive territory.
  • Preliminary US durable goods orders are the data highlight Friday, although the final release of UMich sentiment for April will also be watched for any revisions to the sharp bump higher in inflation expectations as part of the preliminary release. Fed's Waller also is set to speak later today on rates, and with a text release, however his recent TV appearances and prepared statements should mean we hear little new on current policy.