Data Miss Keeps USD Pressured
The US dollar weakened again over the European morning on Friday. Expectations of a forthcoming rate cut from the Fed have ratcheted higher in the wake of recent data weakness which saw CPI lower than expected over May. USD index trades 96.56 last with price having turned lower from the 97.10 level once again. Looking ahead today traders are waiting on the release of the U. of Michigan confidence reading.
ECB Easing Expectations Keep EUR Weighed
EURUSD has been weaker today also, despite the lower US dollar, marking its fourth losing day this week. Expectations of imminent ECB easing have capped the recent advance in the pair turning price back down toward the 1.1264 level following a strong rally last week.
GBP Still Weak
GBPUSD has also been weighed upon today as Brexit concerns continued to dominate the landscape in GBP trading, despite better earnings and employment data earlier in the week. GBPUSD trades 1.2639 last with price having broken back down below the 1.2658 level.
Risk Assets Pause Following Strong Rally
Risk assets have been a little softer over the final day of the week so far. Expectations of a fresh wave of easing from both the Fed and the ECB have helped alleviate concerns regarding the ongoing US/China trade war. However, the risks from the trade war remain a high-level threat. This week, a list of 600 US companies warned the US president about the negative impact of his aggressive trade policies. Indeed, Walmart which is the largest US private sector employer and also the largest global retailer has said tariffs will increase prices for US consumers. SPX500 trades 2886.83 last, holding above the 2877.30 level.
Gold & JPY Both Higher
Safe havens have both been higher against the US Dollar again today with JPY and gold both gaining on USD weakness. Expectations of easing by the Fed has seen gold prices exploding higher recently. XAUUSD trades 1352.71 last sitting at fresh 2019 highs. USDJPY has also turned lower with price sitting at 108.23 last, just above the recent 2019 lows.
Crude Capped By Further Oil Stores Build
Oil prices have been a little softer today also despite USD weakness as the market digests the latest report from the EIA which showed a further build last week. The weekly report from the Energy Information Administration showed that US crude stores jumped by 2.2 million barrels last week, in stark contrast to the -481k reading expected. This marks the second straight weekly rise and has fuelled concerns once again around soaring US crude production. Crude trades 52.22 last.
Commodity Currencies Down
USDCAD has been a little higher over the day so far, despite USD weakness, as expectations for falling oil price as well as ongoing trading disputes have seen CAD a little softer this week. USDCAD trades 1.3335 last, up from the mid 1.32 lows plumbed on Monday.
AUDUSD has been lower again today, marking its third straight day of losses, despite soaring gold and equities prices. Earlier in the week, AUD unemployment rate data came in higher than expected at 5.2% vs 5.1% expected. AUDUSD trades .69 last, with price sitting between the .6863 lows and the recent .70 level retest. Focus, for now, remains on further downside.