Friday 24 February 2023
The Greenback remains underpinned overall but we're ranging still as the uncertainty continues. The widely anticipated speech from BOJ Governor nominee Ueda ultimately was a bit JPY dovish but provided good two-way business as expected given previous comments. Seems he remains flexible on YCC and aware of potential market volatility but focussing on inflation still which last night showed core CPI at the highest levels in over 40 years.
Month-end flow signals are pointing to USD demand with no particular weakest currency. Today markets are trading month-end Spot value so keep an eye on the 4pm London fix in addition to the general flow of USD demand we're seeing at the moment.
Equities are off their latest highs after a decent dip and rally yesterday while WTI has enjoyed a decent bounce after holding $74.50-00 yesterday$73.75-80 but now capping into $76.50 as I type. Gold capping into $1835 after its $1823 lows amid the uncertainty. Ukraine/Russia war continues to be the elephant in the room.
Data today brings US PCE so maybe some fun and games around 13.30 GMT. US Fed's Mester and Jefferson plus BOE's Tenreyro all speaking later too.
GBPUSD: A decent hold of 1.2000 this time after capping at 1.2050-70 amid the general USD demand and I remain a rally seller but caution still required at these lower levels. EURGBP: Tightly bound still and holding 0.8790-00 with sellers poised into 0.8825 still. Expect some more two-way trading as core pairs fluctuate. GBPJPY: A support line now forming at 161.80-00 after the extended retreat to 161.20 amid the Ueda testimony. Sellers will remain poised though as the uncertainty continues.
EURUSD: Holding 1.0580 in the latest retreat with sellers capping at 1.0630 amid the general USD demand .USDJPY: Capping around 135.20 as I type having gratefully banked pips in the Ueda-led retreat into 134.00. Still poised to re-sell rallies when momentum fade but caution required amid month-end USD demand.
Plenty more to read in my full report and more detailed update for traders plus my 1-2-1 mentoring sessions. Mail mike@mspfx.co.uk for more info.
Interbank rates: 08.23 GMT
GBPUSD 1.2030
EURUSD 1.0591
EURGBP 0.8803
GBPEUR 1.1360
USDJPY 134.90
EURJPY 142.88
GBPJPY 162.33
GBPCAD 1.6313
GBPCHF 1.1240
GBPZAR 22.0287
GBPHKD 9.3714
EURCHF 0.9908
EURHKD 8.2494
AUDUSD 0.6794
NZDUSD 0.6220
USDCAD 1.3556
USDCHF 0.9352
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