Currency Updates:
U.S. Dollar Trading (USD) the USD gained on Friday after weaker than expected US jobs increased safe haven demand for the world’s reserve currency. June NonFarm Payrolls came in at 80k vs. 90k forecast. The June Unemployment rate stayed at 8.2%. US stocks fell sharply and Oil and Gold both slumped with some investors expecting the FED to do more to stimulate the faltering US recovery. Looking ahead, FOMC Member Williams speaks.
The Euro (EUR) EUR/USD moved lower as the downtrend continued with 1.2300 broken after the NFP. EUR/JPY was a bigger mover down to Y97.50 and will be closely watched in Asian trade today. EUR/GBP is still holding in the lower 0.7900 area with the GBP still holding at supports.
The Japanese Yen (JPY) the USD/JPY reacted immediately to the US jobs missing expectations falling from Y80 to Y79.50 support. The outlook is for more range trading between Y78 and Y80 but the intervention risk is increasing as the EUR/JPY slide continues.
The Sterling (GBP) the USD strength on Friday sent Cable to its final big support at 1.5450. The outlook is for more USD strength unless there is FED easing or the EUR/USD can find support. EUR/GBP is a source of constant support but this cannot continue forever. Also ahead, ECB President Draghi and UK MPC member Tucker are scheduled to speak.
Australian Dollar (AUD) the AUD/USD reversed direction with US stocks falling to 1.0180 supports. The AUD/USD has outperformed last week with solid economic data and new all-time lows for the EUR/AUD helping lift the commodity currency. The EUR/AUD is looking to test the major 1.2000 level with the multi-year downtrend now hitting another big level. Looking ahead, Chinese CPI forecast at 2.4% vs. 3.0% previously/y.
Oil & Gold (XAU) Gold continued a pullback for the second day with the USD strength overwhelming the safe haven demand for the precious metal. The outlook is for more range trading with buyers waiting for support before once again attempting to break $1630oz. OIL/USD was crunched lower on the US economic concerns post Jobs data falling below $85 a barrel.
