1. Reports
  2. Daily FX Report
Non-independent Research

Daily FX Report

Read disclaimer


The Euro held a firm tone into Friday’s New York open with the single currency gaining some support from expectations that the Euro-zone outlook was improving. A stronger vaccination rate should be an important element in allowing an easing of restrictions and a stronger recovery.

Headline US retail sales were unchanged for April, below expectations of a 1.0% increase, but the March surge was revised higher to 10.7% from the original reading of 9.7%. Underlying sales declined 0.8% on the month compared with expectations of a 0.7% gain and following a 9.0% gain previously.

The control group recorded a 1.5% decline following a 7.6% gain the previous month. The dollar was unable to gain any significant support from the retail sales data with fresh doubts following underlying demand conditions following the much weaker than expected employment report released earlier in May.

The University of Michigan consumer confidence index declined to 82.8 for May from 88.3 previously and below consensus forecasts of 90.0 with a decline in the current conditions and expectations components. There was a surge in the 1-year inflation expectations index to 4.6% from 3.4% previously with the 5-year rate at 3.1% from 2.7% and inflation developments will remain a crucial market factor in the short term.

Cleveland Fed President Mester stated that the central bank is really focussed on inflation expectations at present. She saw inflation at 2% this year and heading lower again next year.  The dollar remained on the defensive and the Euro strengthened to highs around 1.2140.

CFTC data recorded a net increase in short, non-commercial dollar positons for the week, maintaining the potential for short covering. The dollar gained an element of respite on Monday with a slightly more cautious tone surrounding risk curbing selling pressure and the Euro traded around 1.2130 at the European open.



US Treasuries rallied following the US retail sales data with the 10-year yield just below the 1.65% level while the 5-year yield was held around 0.82%. The dollar tended to drift weaker as yields moved lower, although the impact was limited as the yen also lost some support amid renewed gains in equity markets. Overall, the dollar dipped to the 109.30 area at the New York close with both currencies unable to secure sustained support.

Annual growth in Chinese industrial production slowed to 9.8% for April from 14.1% the previous month and retail sales were also notably below expectations with an annual increase of 17.7%. Chinese officials expressed some caution over fundamentals which also hampered overall risk appetite.

There were also reservations over regional coronavirus trends with increased cases and restrictions in Singapore and Taiwan. Regional equity markets were mixed with losses for Japan offset by gains in China and the dollar posted a limited net gain to 109.35 after hitting selling interest close to 109.50.



Overall Sterling moves were influenced more strongly by global developments on Friday with a lack of domestic data. There were, however, some reservations over the Indian coronavirus variant in the UK which continued to spark some speculation that there could be a delay to the UK re-opening measures due in June.

In this context, there was some caution ahead of a news conference by Prime Minister Johnson after the European close.

Sterling nudged above 1.4100 against the US dollar as the US currency lost ground in currency markets while the Euro found support below 0.8600.

CFTC data recorded a net increase in long Sterling positions to 28,000 contacts in the latest week, maintaining the risk of a correction if confidence dips. Reservations surrounding the Indian variant continued over the weekend, but with some relief that vaccines were still seen as effective.

Risk conditions were slightly more cautious on Monday, but housing data remained strong with further evidence of tight labour markets. The UK currency traded just below 1.4100 against the dollar as the US currency stabilised with the Euro holding just above 0.8600 as markets continued to monitor coronavirus variants.



The Swiss currency was held in tight ranges on Friday with a lack of fresh incentives. The Euro posted slight gains to the 1.0950 area while the dollar retreated to lows near 0.9010 amid wider weakness, although there was some support close to the 0.9000 level.

Markets continued to monitor global inflation trends closely with further concern over longer-term trends. Developments in precious metals and cryptocurrencies were also a significant element in Asia with tentative net support for the franc with the dollar trading around 0.9025.




This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

Sign-up to get the latest Non-independent research

We will email you each time a new report has been published.

You might also be interested in...

Daily Report Base Metals

Our daily commentary, covering market news and closing prices of LME aluminium, copper, lead, nickel, tin, zinc, iron ore, steel, and precious metals.

Daily Report Softs Technical Charts

Technical analysis and charts for the key sugar, cocoa and coffee contracts.

Weekly Report FX Options

Our FX Options Report contains commentary and analysis covering OTC currency option pricing, volatility and positioning. 

Quarterly Metals Report – Q3 2022

Our analysts provide an in-depth analysis of the metals market and current macroeconomic conditions. The environment has weakened significantly as growth fears rise amid persistent high inflation. Central banks are data-dependent, which could mean they slow rate hikes as growth starts to slow. This has meant a downside to the US 10yr yield, but also we see a downside to rate hikes in Q4. Europe will likely enter a recession before the US and take longer to recover, but material availability is significantly lower, shown by low inventories.

FX Monthly Report June 2022

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we look into the JPY and the pressure the BOJ is under to change their monetary policy as JPY continues to weaken against major currencies. Economic data is weakening and inflation is less of a problem in Japan, but yields continue to test the cap.