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Week in FX Europe 8-13 July

Without either monetary or political development that can meaningfully compress sovereign spreads the odds are tipped for the EUR to retest sub 1.21 again. Peripheral markets are tighter in what optically looks like short covering. ‘Real money’ is reported to be buying the belly of the Spanish and Italian yield curve. Is it sustainable? A stuttering China and ongoing euro-zone concerns continue to keep investors at bay. The lack of urgency again shown by Euro-zone ministers to right the ship is more market negative than positive. The directional uncertainty is forcing more investors to the sidelines. Because these investors are record short EUR’s, paring positions currently requires bidding up the single unit and potentially squeezing out some much weaker short positions along the way.

Below are some other highlights of the week:


EUROPE

 

ASIA Week in FX [1]

AMERICAS Week in FX [2]

 

WEEK AHEAD

  • Retail Sales comes to us from USD and GBP
  • Inflation indicators are delivered from NZD, GBP, USD and CAD
  • AUD and GBP both release their respective MPC meeting minutes
  • The BoC presents CAD’s rate announcement
  • EUR has German ZEW economic sentiment to contend with
  • Both GBP and USD has unemployment claims to ponder
  • Building and Home sales data is released in the US
  • The week finishes with USD Philly Fed index

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Dean Popplewell

Dean Popplewell [7]

Vice-President of Market Analysis at MarketPulse [8]
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell
Dean Popplewell

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