 Yen regains some ground today as global markets, except US, are back in risk averse mode. Another day of selloff in the Turkish Lira is a reason for the selloff in European stocks. USD/TRY hits as high as 6.839 today and is currently up 4.76 %, 7.00 handle is within touching distance. Weakness in Chinese stocks and Asia is another factors weighing down sentiments. The US is making progress in trade negotiations with Mexico, Canada and the EU. But China as an outsider to the allies is left behind. Swiss Franc is following as the second strongest for today, Dollar as the third strongest. Commodity currencies are generally under pressured. New Zealand Dollar was sold off earlier today on terribly bad business confidence data. Canadian Dollar also suffers some selling after Q2 GDP miss. USD/CAD surges on the back on contrasts in US and Canadian Dollar. However, it should be emphasized that 2.9% annualized growth is never a bad number for Canada. BoC is going to hike again, just a matter of September or October. And both Trump and Canadian Prime Minister Justin Trudeau expressed optimism that a trade deal can be concluded this week. So, we'd suggest not to be too bearish on Canadian Dollar. In other markets, major European indices are all in red, with FTSE down -0.76%, DAX down -0.74% and CAC down -0.57%. EU showed friendly hands to UK on Brexit negotiation. It also indicated that auto tariffs can be scrapped if US does the same. But these positive factors are seemingly not enough to offset worries over Turkey. Earlier today Nikkei closed up 0.09%, Hong Kong HSI down -0.89%, China Shanghai SSE down -1.14% and Singapore Strait Times down -0.56%. Gold continues to trade in tight range above 1200 handle as consolidation extends. |
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