Forex - European Highlights ~ Friday 18th May

 10:06 (GMT) 18 May

  [Forex Highlights]

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European Highlights ~ Friday 18th May (0100-ZYGQ-C01)

Asia FX and News -

+ China said to offer Trump USD200bn cut in deficit - BBG

+ US NAFTA negotiator: 'nowhere near close to deal' - BBG

+ No decision on US metals tariffs, Japan's Seko says ~ BBG

+ Japan's inflation slows amid rising calls for delay in BOJ Exit - BBG

+ China Commerce Ministry says to terminate anti-dumping, anti-subsidy investigations on US sorghum - Reuters

+ US10yr yield on the climb but USD/JPY stalled at 111.00 as it ran into offers. EUR/USD steadied at 1.18, while Cable held just clear of 1.3500. In narrow trade the NZD edged a shade higher, AUD/NZD either side of 1.0900. CAD was given a slight knock as US Nafta negotiator Lighthizer said they are nowhere near close to a deal, but 50 day MA keeps the rise in check on USD/CAD.

Nikkei and JGBs -

+ N225 closed +0.4% at 22930.36. 10yr JGBs yield 0.067%

European FX and News -

+ Familiar levels on EUR/USD, generally holding above 1.1800 until - just as yesterday - dipping below to 1.1780 as very early bird N.American traders came in, while the proposed Italian ruling alliance have been outlining economic plans.

+ USD/JPY has a brief look over 111.00 but there are solid offers just over and EUR/JPY accompanied the EUR/USD dip to help keep the lid on. GBP/JPY and another look over 150.00is proving another high hurdle for JPY shorts.

+ Cable is tracking EUR/USD, EUR/GBP finding some buyers but close to unchanged on the morning.

+ USD/CHF is losing the battle with 1.00, EUR/CHF breaking back down below 1.1800. Risk appetite is being soured by reports of China denying the offer to reduce the USD200bn deficit with the US, though doubts have already been widely expressed that the US can fill the gap anyway other than at a cost of wider deficits elsewhere.

+ USD/CAD trades close to the 50 day MA with Canadian retail sales and CPI the only data due of any note. AUD/USD is holding over .7500, if not by much, but AUD/CAD more comfortably clear of recent lows. NZD slightly improved overall, holding .69 against the USD, AUD/NZD at 1.0870/75.

Bonds and Equities -

+ BTPs pressed back towards y'day's yield highs after initial profit-taking. Italian banks, led by Monte Paschi, particularly hit as well. Spain outperforms well on cross action too post supply, IT-ES 10s out to 77bp, breaking to post 2012 wides. Bunds much more tepid, only managing flat, while Gilts find a touch of support from 121 area. Equities generally flat (FTSE) to small down, Dax -0.2%, Eurostoxx -0.5%.


JP: CPI Core (Nation) (Apr) 0.6% y/y (Mkt: 0.7 Prev: 1.1)

JP: Natl CPI Ex Fresh Food, Energy (Apr) 0.4% y/y (Mkt: 0.4 Prev: 0.5)

06:00 GMT - DE: PPI (Apr) % m/m (Mkt: 0.3 Prev: 0.1)

06:00 GMT - DE: PPI (Apr) % y/y (Mkt: 1.8 Prev: 1.9)

06:00 GMT - DE: Wholesale Price Index (Apr) % m/m (Prev: 0)

06:00 GMT - DE: Wholesale Price Index (Apr) % y/y (Prev: 1.2)

08:00 GMT - EU: Current Account (nsa) (Mar) EUR bn (Prev: 22.7)

08:00 GMT - EU: Current Account (sa) (Mar) EUR bn (Prev: 35.1)

08:00 GMT - IT: Current Account (Mar) EUR mn (Prev: 839)

09:00 GMT - EU: Trade Balance (nsa) (Mar) EUR bn (Prev: 18.9)

09:00 GMT - EU: Trade Balance (sa) (Mar) EUR bn (Mkt: 21 Prev: 21)

Still To Be Released:


12:30 GMT - CA: CPI (Apr) 4cast: 0.3% m/m (Mkt: 0.3 Prev: 0.3)

12:30 GMT - CA: CPI (Apr) 4cast: 2.2% y/y (Mkt: 2.3 Prev: 2.3)

12:30 GMT - CA: Retail Sales (Mar) 4cast: 0.2% m/m (Mkt: 0.3 Prev: 0.4)

12:30 GMT - CA: Retail Sales (ex Auto) (Mar) 4cast: -0.1% m/m (Mkt: 0.5 Prev: 0)

13:00 GMT - BE: BNB Consumer Confidence (May) (Prev: 2)

Events & Auctions:

03:30 GMT - JP: 3mth Bills Auction

07:00 GMT - US: Fed's Mester Speaks in Frankfurt

07:30 GMT - PT: Bank of Portugal's Costa Speaks in Lisbon

10:00 GMT - UK: 182-Day Bills Auction (GBP 1.5bn)

10:00 GMT - UK: 28-Day Bills Auction (GBP 500m)

10:00 GMT - UK: 91-Day Bills Auction (GBP 1bn)

13:15 GMT - US: Fed's Brainard Speaks in New York

13:15 GMT - US: Fed's Kaplan Speaks in Richardson, Texas

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