Russian Attack On Ukraine's Key Nuclear Power Plant Spooks Europe

European currencies got battered while the risk switch flicked to off as Russian troops shelled Ukraine's (and Europe's) largest nuclear plant setting it ablaze. Initial headlines flagged the danger posed by damaged reactors and suggested that Russian shelling prevents fire brigades from entering the plant. The news rattled markets by raising the prospect of potential radioactive contamination, but subsequent headlines helped soothe the nerves. Ukrainian officials clarified that the fire broke out in a training complex outside the main perimeter of the plant, leaving essential equipment intact and causing no change in radiation levels. The emergency services managed to put out the fire but the incident fuelled fears that continued fighting may lead to dramatic unforeseen consequences. President Zelensky and his ministers contacted their Western counterparts, with UK PM Johnson pledging to call an emergency session of UNSC to discuss the situation.

• Major continental European currencies got battered on the back of contagion risk, with events at Zaporizhzhia Nuclear Power Plant drawing attention to risks surrounding the war in Ukraine. EUR/CHF printed a session low of CHF1.0117, a fresh multi-year trough, before trimming some losses. The Scandies, EUR and CHF continue to trade on a softer footing as we head for the London session.
• The main Asia-Pac risk barometer AUD/JPY fell to Y84.16 in the initial reaction to the Zaporizhzhia NPP news before bouncing to a new four-month high. The Antipodeans gained the most from the unwinding of initial risk-off moves and jumped onto the top of the G10 pile. The yen is the third best performer as the attack on Ukraine's key nuclear facility continues to spook Europe.
• U.S. NFP report headlines the global data docket today, with EZ retail sales also due.