USD: The Dollar has kept fairly close to unchanged levels in what has been a subdued overnight trading session, but it is showing little inclination to recover any significant portion of yesterday’s sizable losses. A rate cut in South Korea and slightly stronger than expected Chinese CPI data result have provided fresh fuel for risk appetites this morning, which is likely to create some additional headwinds for the Dollar early in today’s session. The market will finally have a top-tier US data point to digest with today’s weekly Jobless Claims numbers, which could give the Dollar a moderate boost if they remain close to their recent multi-year low levels. Unless overseas risk concerns start to become a front and center issue for the market once again, the Dollar appears to have limited upside potential. The Dollar may climb up towards the 82.10 area in reaction to some positive Jobless Claims results this morning, but it needs to find additional safe-haven support in order to lift clear of these recent low price levels.
EUR: The June Euro went through some choppy and volatile trading action over the past few hours, and appears to have run out of upside momentum. While the strength seen in recent German economic data is not being found in other regions of the EU, those numbers have helped to repair sentiment in the wake of last week’s dovish ECB post-meeting rhetoric. Strong demand levels at today’s Spanish debt auction are also a positive sign for the Euro, but it will be difficult for the market to climb past last week’s high without some further signs of economic progress out of the peripheral EU. Threats of further easing action by ECB officials continue to hang over the market, which will also weigh on the Euro this morning. The June Euro should find support around the 131.28 level, and may need to see a stronger tone from outside markets in order to rise back towards yesterday’s weekly high.
GBP: The June Pound is holding onto moderate gains this morning, but once again could not sustain a move towards the 156.00 resistance level. While this morning’s UK Industrial Production and Manufacturing data came in stronger than forecasts, there may be some trepidation with taking the market into new high ground in front of today’s Bank of England meeting. A mostly positive tone to recent UK economic data should insure that the BOE holds off on fresh easing measures over the near future, but recent central bank rate cuts have created some fresh doubt in the market. The June Pound should head back towards the 155.92 level once the BOE meeting is out of the week, and with help from stronger outside markets the Pound should reach a new 21/2-month high by the close of today’s trading session.
JPY: The June Yen has shaken off overnight pressure and is holding onto modest strength early in today’s session. There are indications that the Yen will again be a subject matter at this weekend’s G8 meeting, which has led to some ideas in the market that aggressive Japanese easing measures may diminish over the near future. A lack of fresh Japanese economic data has helped to fuel this uncertainty, particularly on the inflation front as there has been little initial progress with reaching their 2% target level. Last night’s South Korean rate cut may have provided some fresh flight to safety flows, but the Yen will need a significant deterioration in global risk attitudes in order to see any large extension to this week’s rally. The June Yen may slide back towards the 101.15 level later this morning, and is likely to head for a retest of the recent lows once the G8 meeting is out of the way.
CHF: The June Swiss was able to regain some lost ground versus the Euro this morning, and extended this current rebound to a new weekly high before losing upside momentum. While recent Swiss economic data has seen mostly positive results, yesterday’s lukewarm Swiss inflation data will be difficult to fully overcome over the near-term. The June Swiss will find decent near-term support around the 106.82 area later in today’s session, but should remain fairly well supported as long as global risk attitudes do not deteriorate sharply over the rest of today’s trading.
CAD: The June Canadian continues to drive further into new high ground this morning, and has been able to hold above the 200-day moving average for the first time since mid-February. Recent Canadian economic data continues to show mixed results, however, so the Canadian may have to wait until tomorrow’s Canadian Employment data before making a run at the 100.00 level. The June Canadian should remain well supported this morning, and will have a near-upside target of 99.84 in front of the always-volatile Canadian jobs data tomorrow morning.