USD Remains King, CHF Flash Crash, GBP & EUR at Crucial Support - US Market Open
MARKET DEVELOPMENT – USD Remains King, CHF Flash Crash, GBP & EUR at Key Support
USD: The US Dollar has begun the week on the front with major G10 currencies softer across the board. However, key levels are holding for now with 1.1300 and 1.2900 keeping the Euro and GBP afloat, respectively. US data to be key this week, most notably the inflation report given the recent monetary policy statement from the Federal Reserve.
CHF: The Swiss Franc got off to a soft start with a mini flash-crash being observed in major CHF pairs at the beginning of trade in the Asian session. With Japan away for a market holiday, liquidity had been thinner than usual consequently exacerbating the price action in which CHF weakened by 1% with EURCHF hitting highs of 1.1425, before quickly retracing. SNB later declined to comment on the move.
GBP: Soft UK data saw GBP briefly dip below the 1.29 handle. The first look at UK GDP indicates that economy had been growing at a rate of 0.2%, leading to a yearly rate of 1.3% (Exp. 1.4%). The data also showed the impact that Brexit had on business decisions, as investment had dropped for a 4th consecutive quarter. Support at 1.2890 continues to hold for now as GBP remains resilient.
EUR: The Euro remains on the backfoot, however, key support at the 1.13 handle has continued to curb losses. Despite seeing a slight breach of 1.13, the post ECB low at 1.1289 has kept the Euro elevated, a closing break below however, raises scope of a test of 1.1215.
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--- Written by Justin McQueen, Market Analyst
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