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Risk Tone Improves, Chinese Trade Data Support Yuan

FOREX

Today's fairly lacklustre Asia-Pac session saw the Antipodeans take a narrow lead in the G10 pack, as most regional equity benchmarks eked out some gains. AUD/USD flirted with the round figure of $0.7500, while NZD/USD returned above the $0.7000 mark. AUD/NZD shed a handful of pips as Australia's NAB Business Confidence deteriorated.

  • Better risk tone reduced demand for safe haven assets, leaving JPY and USD at the bottom of the pile. The DXY faltered ahead of the release of monthly U.S. CPI.
  • An uptick in crude oil prices failed to shield the NOK, which was among the worst G10 performers.
  • USD/CNH traded on a softer footing, as China reported a wider than expected trade surplus for the month of June, underpinned by considerable beats in both exports and imports. The PBOC fix came in 10 pips above sell-side estimate, provoking virtually no reaction.
  • Focus turns to inflation data from the U.S., Germany & France, while BoE Gov Bailey is set to speak on the Financial Stability Report.

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