FOMC MINUTES AND EM OUTFLOWS DRIVING FX
• USD is strong as market positions for risks associated with minutes.
• FED—we expect minutes to hint at Sept taper (as long as data is as expected) & to reinforce interest rates on hold for an extended period.
• CAD is weak trading to a fresh one month low. Risk is FOMC.
• EUR soft, but near range highs; technicals warn of lack of conviction.
• GBP is flat but outperforming—still vulnerable to short covering and technicals support test up to June 1.5752 high.
• JPY is flat, as market ignores Gov Kuroda’s commitment to inflation.
• NZD is weak—RBNZ tries to cool housing & tightens mortgage lending.
Read the full report: FX Daily
Scotiabank