The forex markets are relatively steady in Asian session today. For the week, Yen is so far the strongest, following mild risk aversion. Investors are concerned that the US is going to escalate trade war with EU, while they haven't even finished negotiations with China. The punitive and retaliation tariffs of US and China are staying there as the talks drag on. Extra tariffs between US and EU will be another huge blow to the global economy. Australian Dollar is currently following as the second strongest for the week. It quickly reversed earlier loss today after RBA Deputy Guy Debelle didn't bring additional dovishness with his speech. Economists continue to expect two RBA cut this year. But with the first one expected in August, it's a bit early for RBA to turn full-blown dovish yet. Dollar is currently the weakest one for the week, together with Swiss Franc. Selloff in US stocks this week, with 10-year yield back below 2.5 handle, is weighing down on the greenback. Sterling is mixed as EU is expected to grant UK and one-year flexible Article 45 extension. Euro is also mixed while ECB announcement might bring little news. Technically, downside momentum in Dollar diminished somewhat after yesterday's selloff. But more downside in Dollar remains in favor against Euro and Yen. Also, as Yen might gather some more strength, 124.96 minor support in EUR/JPY will be in focus. Break will indicate completion of rebound from 123.65 and bring retest on this support. In Asian markets, Nikkei is currently down -0.57%. Hong Kong HSI is down -0.31%. China Shanghai SSE is down -0.08%. Singapore Strait Times is up 0.11%. Japan 10-yer yield is down -0.0091 at -0.054. Overnight, DOW dropped -0.72%. S&P 500 dropped -0.61%. NASDAQ dropped -0.56%. 10-year yield dropped -0.02 to 2.499, below 2.5 handle. |
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