European Summary and Highlights 17 Apr
The USD was slightly softer through the European morning. EUR/USD gained around 20 pips to 1.0640, and GBP/USD was a little stronger, rising around 40 pips to 1.2470.
European morning session
The USD was slightly softer through the European morning. EUR/USD gained around 20 pips to 1.0640, and GBP/USD was a little stronger, rising around 40 pips to 1.2470. GBP was helped by the slightly stronger than expected UK CPI data, which saw y/y CPI inflation fall to 3.2% y/y against the 3.1% expected. The core also fell slightly less than expected to 4.2% against the 4.1% expected. EUR/GBP dipped as low at 0.8520 before recovering to be down only around 10 pips on the morning at 0.8540. UK front end yields were only very marginally higher.
The USD was also generally softer elsewhere, but USD/JPY was only down around 10 pips to 154.55, and USD/CHF also lagged a little, with EUR/CHF recovering strongly above 0.97 after an initial dip.
Asia session
As RBNZ has previewed, NZ Q1 CPI came in at 4% y/y, continues to moderate but well above RBNZ target. While RBNZ has put the blame on transitory factor, it no doubts delay the step of potential easing as we see the bank has delayed the first cut from end of 2024 to start of 2025. Kiwi cheers on the hot CPI and see NZD/USD trades 0.29% higher at 0.5898 while AUD/USD trade 0.07% higher at 06406 and USD/CAD rose 0.05% with oil down half a dollar.
While we continue to hear more jawboning from Japanese officials, the shine for Japan lies in another strong export report. Japan March exports came in at +7.3% y/y, expanding four month in a row with exports to China leading the gains. It shows the merit of a soft JPY. However, we see import contracts which is the downside for weaker JPY and also showing a soft domestic demand from Japan. USD/JPY is taking a break and trades 0.07% lower at 154.6 with both the U.S. Treasury and JGB yields higher. Else, EUR/USD is down 0.07% and GBP/USD is up 0.06%.