The EUR/USD opened in Asia around 1.3365 after once again failing above 1.3380 during the US session. The Asian session was a non-event for the EUR/USD with the pairing dormant in a 1.3363/75 range. There was talk of very good buying interest between 1.3340/50 while sellers were lined up between 1.3380/90 to keep prices hemmed in. EUR/JPY traded between 157.35/75 for most of the Asian session with traders reporting only light flows throughout.
The EUR/USD is sidelined as heading into the holiday period with the action confined to yield plays that are benefiting the GBP, AUD and NZD at the expense of the JPY. The market appears to be fairly sanguine regarding the looming trade tiff between the US and China even though some analysts are warning that an escalation could have negative implications on the USD and result in the EUR/USD accelerating higher at some stage.
Instead the market remains focused on central bank expectations. The data out of the US is suggesting that inflation pressures are severe enough to keep the Fed from cutting rates and this is limiting the upside for the EUR/USD. EZ PPI is out today.
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