- AUD leads, JPY lags the day
- European stocks up; S&P 500 futures up 0.2%
- US 10-year yields up 1.9bps to 3.656%
- Gold up 0.3% to $1,967.55
- WTI crude down 0.5% to $67.74
- Bitcoin down 0.8% to $26,894
There was plenty of data to sift through during the session, but the most notable is that Eurozone inflation may be starting to show signs of slowing. Both headline and core inflation eased in May, bringing welcome relief to the ECB and the economic outlook.
ECB policymakers were quick to deliver some timely messages and remind markets that their job is not yet done despite this week’s more upbeat data.
The euro was little changed in the news, however, as much of that was affirmed by individual country readings earlier this week.
Instead, it was more the case with the dollar faltering after a brighter start to the session. The greenback advanced early but gave up its gains and fell in European trading today.
EUR/USD fell to 1.0665 earlier, but resumed its way above 1.0700, with significant option expiries possibly also playing a role on the day. GBP/USD also dipped towards 1.2400 but saw a fairly modest pullback to 1.2480 as buyers look to retest the 1.2500 mark.
Next, we saw USD/JPY rise to 139.95 late in Asia as rising bond yields helped support the pair. However, as the USD reversed, the bullish momentum also accelerated, with the pair falling back to 139.45 for now.
The Antipodes are arguably the ones finding the most relief in today’s USD reversal, with AUD/USD briefly falling to 0.6485 before now rising to 0.6520. Meanwhile, NZD/USD also tested the waters below 0.6000 before rising to 0.6020 currently. Both pairs hold the line at key support at 0.6500 and 0.6000 respectively.
Now it’s the turn of US ADP data to see where it takes us next and how it will affect expectations ahead of tomorrow’s main event.