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Greenback Trades With A Bid Tone, EUR Crosses Under Pressure

FOREX
  • Intra-day price action remained more subdued in currency markets on Friday as the post CPI volatility from Wednesday loses steam. Overall, the USD index is set to post a 0.5% gain as the greenback claws back losses incurred since the US inflation data release.
  • The greenback advance was mirrored by weakness in EUR, GBP and JPY, however, notable outperformance was seen in the likes of AUD, NZD and CHF. Antipodean FX benefitting from the continued strength of major equity indices and the price action likely being exacerbated by weakness in EUR crosses with both EURAUD and EURCAD close to one percent lower on Friday, both narrowing the gap with the April lows.
  • Further downside momentum in EURCHF throughout the day as the pair continues to trade at the lowest levels since the floor was removed in January 2015 with little in the way of technical support.
  • The Swedish Krona is the weakest currency in G10 following the weaker-than-expected CPI data early on Friday. USDSEK is +1.4% higher on the session as well as NOKSEK rising over 1% to a three and a half month high. Norway’s above estimate CPI readings earlier in the week potentially exacerbating the divergence for NOKSEK ahead of next week’s Norges Bank rate decision.
  • The other notable events on the calendar are the RBNZ rate decision and the FOMC minutes, both due on Wednesday.
  • Chinese activity data headlines on Monday, with CPI prints for the UK and Canada later in the week. In the US, July Retail Sales is due for release.
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  • Intra-day price action remained more subdued in currency markets on Friday as the post CPI volatility from Wednesday loses steam. Overall, the USD index is set to post a 0.5% gain as the greenback claws back losses incurred since the US inflation data release.
  • The greenback advance was mirrored by weakness in EUR, GBP and JPY, however, notable outperformance was seen in the likes of AUD, NZD and CHF. Antipodean FX benefitting from the continued strength of major equity indices and the price action likely being exacerbated by weakness in EUR crosses with both EURAUD and EURCAD close to one percent lower on Friday, both narrowing the gap with the April lows.
  • Further downside momentum in EURCHF throughout the day as the pair continues to trade at the lowest levels since the floor was removed in January 2015 with little in the way of technical support.
  • The Swedish Krona is the weakest currency in G10 following the weaker-than-expected CPI data early on Friday. USDSEK is +1.4% higher on the session as well as NOKSEK rising over 1% to a three and a half month high. Norway’s above estimate CPI readings earlier in the week potentially exacerbating the divergence for NOKSEK ahead of next week’s Norges Bank rate decision.
  • The other notable events on the calendar are the RBNZ rate decision and the FOMC minutes, both due on Wednesday.
  • Chinese activity data headlines on Monday, with CPI prints for the UK and Canada later in the week. In the US, July Retail Sales is due for release.