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

Daily FX Report

Read disclaimer




The dollar edged higher ahead of Thursday’s New York open with amid position adjustment. The ECB held interest rates at 0.0% following the latest policy meeting and there were no changes to the asset-purchase programme. The bank upgraded its GDP growth forecasts for 2021 and 2022 with next year’s projection increased to 4.7% from 4.1% seen in March. The 2021 inflation forecast was revised to 1.9% from 1.5% with the 2022 forecast projected at 1.5% from 1.2%.

According to President Lagarde, inflation will rise further in the short term due to base effects, temporary factors and the increase in energy prices. She added that it was important to trends in the services sector and underlying inflation is still subdued. Lagarde also noted that any premature tightening poses a threat to growth and inflation. The near-term risks were described as balanced while the council is a little bit more upbeat over the outlook than three months before.

Lagarde also stated that it was too early to talk of tapering bond purchases and, although there was choppy trading the rhetoric overall was close to market expectations.

US consumer prices increased 0.6% for May, above consensus forecasts of 0.4% with the year-on-year rate increasing to 5.0% from 4.2%. This was also above expectations of 4.7% and the highest reading since September 2008. There was a further strong increase in used vehicle prices for the month with a further strong increase in transport services prices. Core prices increased 0.7% on the month compared with expectations of a 0.4% increase while the annual rate increased to 3.8% from 3.0%. This was above expectations of 3.4% and the highest rate since May 1992 which maintained concerns that the increase is more than just transitory.

The dollar briefly strengthened on the data, but gains reversed quickly as yields failed to respond. There were also expectations that the dollar would remain vulnerable if there was no response from the Federal Reserve at next week’s policy meeting. There was choppy trading with little underlying conviction as the Euro consolidated around 1.2170. The US dollar remained on the defensive on Friday as yields remained low with the Euro edging higher to 1.2190.




Chinese new loans increased CNY1500bn for May after a CNY1470bn increase the previous month and slightly above consensus forecasts, although total social financing was slightly below market expectations and there were still some reservations that the Chinese credit cycle was peaking.

US initial jobless claims declined to a fresh 14-month low of 376,000 in the latest week from a revised 405,000 previously, although this was slightly above consensus forecasts. Continuing claims declined to 3.50mn form 3.76mn, reinforcing confidence in the labour market.  US bond yields edged higher following the jobless claims and inflation data, but there was a quick reversal with the 10-year yield back below 1.50% which dampened potential US currency support.

Overall, the dollar failed to hold highs near 109.80 and retreated to below 109.50. There was report that a bipartisan group of US Senators had reached agreement on the infrastructure plan, but bond yields continued to decline and the dollar remained on the defensive.

Confidence in the Japanese economy and yen remained weak, but the dollar was unable to make headway as it traded around the 109.40 area.




Sterling dipped lower in early Europe on Thursday with a break to 1-month lows below 1.4100 against the dollar triggering further selling. There were further reservations surrounding the Delta variant developments within the UK with doubts that restrictions in England would be lifted as well as unease over trade friction with the EU.

The UK currency gained some protection from solid risk conditions. After finding support below 1.4100, there were gains to around 1.4170 against the dollar while the Euro traded just below 0.8600. Sterling was also supported by expectations that the Federal Reserve and ECB would maintain loose policies over the medium term.

UK GDP increased 2.3% for April, in line with expectations, but the industrial production data was weaker than expected for the month. Stering was unable to make further headway following the data as it traded around 1.4180 against the dollar with the Euro close to 0.8600.




The Swiss franc maintained a firm tone in early Europe as German bond yields moved lower. The Euro did find some support below the 1.0900 level with some speculation that the National Bank would intervene to curb any further appreciation, but the franc maintained a firm overall tone.

The Euro consolidated just below the 1.0900 level with the dollar held around 0.8950. Expectations of dovish policies from the ECB and Federal Reserve continued to limit any potential selling on the Swiss currency with the Euro held just below 1.0900 in early Europe.


Technical Levels




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.