With US-China trade talks appearing on shaky ground, the Japanese yen continues to find buyers looking for a safe harbour. The yen pairs are firmly on the back foot, with the USD/JPY dropping for the fifth straight day.
The AUD/JPY is also continuing its slump, heading for its lowest levels since the beginning of the year. The EUR/JPY bounced off the lows yesterday, but is on the back foot again this morning and heading for a test of 123.00. Meanwhile, the GBP/JPY is weak, having suffered five straight days of selling.
The dollar index remains rangebound, with the May lows holding for now.
Dollar pairs are mixed, with the AUD/USD unchanged holding at the lows unchanged so far this morning and some way off the morning highs. The EUR/USD is rising by contrast, making gains for the last three days. The GBP/USD remains weak, but is holding 1.3000 for now.
The EUR/GBP has rallied for five straight days, with the pair heading for a test of 0.8650.
The USD/CAD remains rangebound, but within reach of the highs. The USD/ CHF has struggled however, breaking support at 1.0150.
Today, we have UK GDP at 08.30, released alongside manufacturing production and preliminary GDP.
Canadian employment change and unemployment rate are at 12.30.
Also at 12.30, there is US CPI and FOMC member Brainard speaking.
FOMC member Williams speaks at 14.00.
The US dollar has struggled to make progress beyond 1.0200 over the last two weeks and has reversed below 1.0500 this morning as trades seek out the Swissy’s safe haven.
With the US and Trump ramping up the trade war rhetoric, there could be further downside from here.