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

Daily FX Report

Read disclaimer



Euro-zone GDP was confirmed at 0.6% for the first quarter of 2021 with a year-on-year decline of 1.8%. The Euro maintained a firm tone ahead of the New York open while the dollar remained firmly on the defensive. The Euro pushed quickly above the 1.2200 level for the first time in nearly 3 months and held a strong tone.

ECB council member Villeroy stated that there is no risk of a lasting inflation return in the Euro-zone and that monetary policy should remain accommodative. There were still some expectations that the ECB could taper bond purchases ahead of the Federal Reserve which would support the single currency.

ECB rhetoric will be watched closely given the potential for protests against Euro strength by the central bank if the currency continues to strengthen.

US housing starts declined to an annual rate of 1.57mn for April from 1.73mn the previous month and well below consensus forecasts of 1.71mn with some evidence of higher lumber costs undermining activity. Building permits were little changed at 1.76mn for the month and marginally below market expectations.

The dollar overall was unable to make any headway and the Euro posted net gains to fresh 12-week highs around 1.2225.

Ratings agency Moody’s expressed optimism that the EU recovery fund would support Southern Europe which helped underpin underlying Euro confidence. Underlying dollar confidence remained notably fragile on Wednesday, although there was a tentative recovery against commodity currencies as equity markets moved lower.

The Euro maintained a robust tone and traded around 1.2240 in early Europe despite the more cautious tone surrounding risk appetite.




US Treasuries were held in relatively narrow ranges on Monday with the 10-year yield trading above the 1.60% level. The US dollar was unable to make significant headway amid wider pressure and it dipped below the 109.00 level against the Japanese currency.

US equities dipped lower later in the session and the dollar was unable to regain territory as risk appetite was less confident.

Minutes from May’s Federal Reserve policy meeting will be released later in the day and markets will parse the rhetoric very closely with a particular focus on inflation comments and the underlying debate surrounding any potential timetable for tapering bond purchases. More hawkish rhetoric within the minutes could provide an element of dollar support with the equity market reaction watched closely. Overall market volatility is liable to increase as the inflation debate intensifies.

Bank of Japan Governor Kuroda stated that the economy remains under pressure from states of emergency and there were reports that the emergency measures would not be lifted at the end of this month. Overall, the dollar settled just below the 109.00 level in early Europe with the Euro around 133.25.




Reaction to the UK labour-market release was muted, although there was a net positive impact given that the data overall indicated labour-market resilience.

The latest institutional survey suggested that the global allocation to UK equities hit the highest level since 2014 which suggested strong underlying demand for UK assets. Sterling pushed above the 1.4200 level against the weak dollar, but the Euro found support below 0.8600.

There were still some reservations over domestic coronavirus developments and the risk that the planned removal of social restrictions in June could be delayed. At this stage, markets still expected that the economic recovery would continue, but evidence of much higher transmission rates could have serious implications.

Bank of England Governor Bailey stated that the UK was nowhere near any talk of whether to use negative interest rates. As far as inflation is concerned, Bailey stated that much of the current increase was due to energy and it expects that this will be temporary. Sterling traded just below 1.4200 at the New York close with the Euro just above 0.8600. The headline UK CPI inflation rate increased to 1.5% for April from 0.7% previously and in line with expectations while the core rate increased to 1.3% from 1.1%. Sterling held just below 1.42 against the dollar after the data as the US currency remained vulnerable with the Euro at 0.8625.




The Swiss currency was able to resist further selling pressure on Tuesday amid the on-going focus on underlying inflation pressure. Expectations of very accommodative central bank policies also provided net franc support with currency debasement fears.

The Euro was held around 1.0960 while the dollar breaks below the 0.9000 level-triggered fresh selling pressure and lows near 0.8960. The Euro edged higher on Wednesday amid optimism over the Euro-zone outlook while the dollar was held around 0.8975 as underlying US confidence remained depressed.




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

Commentary and analysis covering OTC currency option pricing, volatility and positioning. This week we focus on USDSGD and whether the SDG recent strength is sustainable given the deteriorating global outlook. 

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.