FX Brief: Weaker Exports Weigh On Sentiment

A summary of news and snapshot of moves from today’s Asia session.


  • Weak export numbers from Japan weighed on sentiment, with manufacturing confidence hitting a 3-year low. Treasuries and equity markets are lower, although contained remains contained overall.
  • Australian employment failed to light another match under rate-cut calls, supporting AUD during a slightly risk-off session. Unemployment remained steady at 5.2%, although RBA will need to see this lower over the coming months to justify recent cuts. Participation rate remained at record highs, although the headline employment figure missed the mark, coming in at 0.5k versus 10k expected down from -9.5k prior.
  • AUD, CHF and JPY are the strongest majors, USD and CAD are the weakest. AUD/CAD is the biggest gainer, with AUD receiving a tailwind with okay employment data and CAD pressured from trade concerns. USD/JPY is the biggest loser of the session, all pairs remain within their typical daily ranges although AUD/JPY is the closest to breaching it.

Up next:

  • UK retail sales is a volatile number at the best of times, and May’s figures were no exception with the YoY rate plummeting -2.8% with cool weather to blame. Shorting GBP is not a new idea and, given GBP/USD’s minor up day yesterday, perhaps it’s approaching a time for a contrarian move and may not take a huge beat to if GBP/USD further. Still GBP/USD is hovering just below key resistance around 1.244/78, so it could be reaching a pivotal moment.
  • US Initial jobless claims hit a 50-year low last month, but it may not be a main driver for the USD with markets expecting further easing from the Fed. USD is receiving safe haven flows and, whilst data overall isn’t great, it’s performing better than the rest of the world on a relative basis. Still, keep USD/JPY in focus as it is approaching 107.54 support.




Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.