FX Brief: Trump Accuses China Of Devaluing Their Currency (Again)

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

FX markets remain confined within tight ranges, following Friday’s volatile US session. CHF and AUD are currently the strongest majors, EUR and USD are the weakest. The USD pared some gains from its NFP-driven strength.

  • Equities were mostly lower as Friday’s strong NFP reduced expectations of the Fed cutting by 50bps later this month.
  • ECB’s Villeroy said their next move will be decided by data, not the markets, in an interview released today.
  • Trump (not for the first time) claimed China is devaluing their currency whilst speaking with reporters. He also said the Fed would lower rates if they knew what they were doing.
  • On the data front, Japan’s machinery orders fell -7.8% in May, its fastest monthly decline since September. Bank lending also eased off to 2.3% YoY (2.6% prior). The Nikkei is currently trading at a 6-day low.

Up Next:

  • Germany’s industrial output will be on the radar for EUR traders, after it fell -1.9% in May, its fastest rate of contraction since August 2014 (especially in light of Villeroy’s comment). With expectation for data to improve, it leaves potential for disappointment and a weaker Euro if it misses the mark.
  • CFTC data will also be released in the US session, which has been delayed due to the US public holiday last week (so expect our weekly COT report to follow).

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.