Forex news from the European morning session 8 Oct

News:

  • BOJ says Japanese production may fall a little in Q3 vs Q2
  • Bank of France cuts Q3 GDP estimate to +0.2% vs +0.3% prev
  • German institutes cut GDP to 1.8% from 2.1%
  • Australian foreign reserves Sept AUD 72.2bln vs 71.2bln prev
  • Bank of Korea is maintaining appropriate accommodative monetary policy
  • BOE Preview: MPC hawks to have their wings clipped still
  • Will BOE inaction pop the cable rally?
  • Preview: GBP should remain in demand after MPC Minutes
  • Preview: ECB Minutes to reflect Draghi's dovish tones says RBS
  • Option expiries 10am NY cut today 8 Oct

Data:

  • Germany trade balance Aug EUR +15.3bln vs +19.0 bln exp
  • Switzerland unemployment rate Sept NSA 3.2% as exp
  • July 2015 Greek unemployment rate 25.0% vs 25.4% exp
  • Japan economy watchers survey current Sept 47.5 vs 49.0 exp
  • Nikkei 225 closes down -0.99% at 18,141.17

It's been a session with central banks in focus but also one that's seen US$ sellers that have benefitted both the euro and pound particularly

It was a quiet start but one that saw USDJPY fall back to 119.80 on a weaker Nikkei finish and that helped drag EURUSD down with It to 1.1230 along with some weaker German trade data

Then European equities opened lower too and we saw the euro stage a bit of a recovery before suddenly spiking sharply for no obvious reason apart from large order flows. EURUSD jumped through 1.1270 triggering stops to post 1.1310 with EURGBP rising to 0.7378 from 0.7345 and EURJPY to 135.20 from 134.80

We saw a small retracement but then the pound found a spring in its step and having first stalled at 1.5335 on the first EURUSD ramp higher we then took out the 1.5350 offers too with EURGBP falling back to 0.7360. Overall the pound has made some gains/recovered poise as we wait on the MPC at the top of the hour

Elsewhere it's been a steadier session with USDCHF inching lower but supported by EURCHF demand while USDCAD has drifted back down to 1.3021 from 1.3075 on the neg-USD sentiment despite softer oil prices

AUDUSD failed to take real advantage of the US$ selling but it did find a base at 0.7165 only to run into offers again at 0.7200. NZDUSD has similarly had the morning off between 0.6590-0.6620

Bring on the CBs!