Forex news from the European morning session 2 Feb

News:

  • Japan PM Abe aide says negative interest rates are not the last resort for the BOJ
  • RBA Statement today "has watered down the ‘easing bias’"
  • RBA today - Westpac keeps its 'on hold' view for all of 2016
  • China faces more outflow pressure in 2016
  • Chinese equity markets close higher 2 Feb
  • We are open to talks on oil, if everyone wants it says Russia's Lavrov
  • UK and EU will discuss proposed first package on Friday
  • SNB's Jordan, the broken record
  • Greece needs cheap energy for growth says Skourletis
  • RBI leaves rates on hold
  • Reuters on oil today: Oil falls on China economic woes, rising OPEC supply
  • Cruz triumphs over Trump in Iowa
  • More detail on the Japanese earthquake: M5.6, 85km east of Miyako
  • Option expiries 10am NY cut today 2 Feb

Data:

  • January 2016 UK Markit CIPS construction PMI 55.0 vs 57.5 exp
  • Eurozone unemployment rate Dec 10.4% vs 10.5% exp
  • German January unemployment change -20k vs -8k exp
  • December 2015 Eurozone PPI -0.8% vs -0.6% exp m/m
  • Italy unemployment rate Dec flash 11.4% vs 11.2% exp
  • Switzerland retail sales Dec yy -1.6% vs -1.7% prev

Another busy morning with oil and the pound sharing the limelight while the euro puts on a decent show as equities soften again.

Oil prices have fallen again before finding some fresh dip-demand and that's set European equities on a softer track underpinning the euro which has remained bid for most of the session.

It's been a mixed bag elsewhere though as the pound fell to 1.4326 as EURGBP demand and weak construction PMI added to the GBP jitters. Since then though some encouraging noises out of the UK/EU talks have helped calm a few nerves and we've seen cable bounce back over 1.4400 and EURGBP drop back to 0.7568 from 0.7616.

USDCHF has remained underpinned along with EURCHF helped by repeated rhetoric from everyone's fave central banker Thomas Jordan of the SNB while USDCAD has done a bit of around trip of its own up to 1.4041 on the oil price falls only then to give it up back to 1.3998.

AUDUSD has been in retreat largely since the post-RBA highs and NZDUSD also with the latest GDT auction today ands large AUDNZD expiries to follow.

No doubting the opportunities these markets are throwing up amidst the volatility but we're not necessarily any the wiser.

Once more unto the breach.