MNI China Daily Summary: Friday, June 7

MNI BRIEF: China May Forex Reserves Rise On Weakened Dollar

MNI BRIEF: BOJ Consumption Activity Index Rebounds In April

MNI BRIEF: China Service Trade Grows Rapidly, Deficit Expands

MNI: PBOC Net Drains CNY98 Bln Via OMO Fri; Rates Unchanged

CHINA PBOC INJECTS CNY2 BILLION VIA 7-DAY REVERSE REPOS FRI

Q1 GDP Deflator At 3.6%; 0.5pp Below Eurosystem Projections

Compensation Per Employee Accelerates Above ECB Forecasts In Q1

MNI: EUROZONE Q1 GDP +0.3% Q/Q, +0.4% Y/Y

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

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Lockdown Takes Shine Off Sterling

GBP
MNI (London)
  • Sterling retained its end of 2020 buoyant tone into the first full day of trading Monday, GBP/USD managed to make a show above $1.3700, touched $1.3704 ahead of the NY open before traders began to book profit.
  • GBP/USD lost its lustre into the US session with expectation of a UK Govt reaction to the rapid spread of the variant COVID-19 squeezed GBP longs, the move supported by the announcement that PM Johnson would speak at 2000GMT.
  • Move extended down to $1.3542 through the 1600GMT fix before it met support.
  • Sell the rumour, buy the fact? GBP/USD recovered to $1.3579 as PM Johnson announced the much expected England lockdown (other areas of the UK doing same).
  • USD was seen under general pressure in Asia which allowed GBP/USD recovery to extend to $1.3603 into Europe, but momentum was seen laboured.
  • Vaccine roll-out/effect now holds the key to how long this lockdown will last.
  • Support $1.3562, $1.3542 ahead of stronger interest into $1.3500. Resistance $1.3600/05, $1.3620/25, $1.3642-66(61.8%-76.4% $1.3704-1.3542) ahead of $1.3704.
  • MNI Techs: GBPUSD started Monday on a firm note. The pair however failed to hold onto the session highs and closed down on the day. Pair recently cleared key resistance at 1.3624, Dec 17 high. Break reinforces a positive trend structure and opens 1.3712 next, the Mar 1, 2018 low. On the downside and given last month's volatile price action, 1.3135, Dec 11 low remains key trend support. Firm support lies at 1.3430, Dec 28 low and 1.3304, Dec 22 low.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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