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USD erases early gains, BoE Vlieghe remarks...>

FOREX
FOREX: USD erases early gains, BoE Vlieghe remarks support GBP
- Traders reported of a DXY buyer in early Europe lending support to the USD.
USDJPY reclaimed Y111.00, momentum type accounts accelerated the move to
Y111.19. The broader-based USD tone pressured both GBP & EUR to fresh daily
lows, before fading the move.
- EURUSD was quick to pare losses, rate squeezed through $1.1800 to $1.1830 as
other leading currency pairs played catch up. EURJPY tracked the move to
Y131.35. EURCHF comfortably held above the 100-dma to print Chf1.1770.
- The GBPUSD recovery stalled ahead of $1.3460, before BoE Vlieghe hit the
wires. Vlieghe said, provided headwinds from Brexit uncertainty do not intensify
in near term and ultimately fade over the coming years, i think policy rates are
likely to rise by 25bp to 50bp per year over forecast period. GBP squeezed to
react highs of $1.3492, before paring light gains.
- Firmer oil prices were seen to support commodity based currency pairs with
AUD, NZD & CAD showing modest gains against the USD. AUD briefly reclaimed
$0.76, NZD extended to $0.6975 and the CAD touched C$1.2750.

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