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

Daily FX Report

Read disclaimer



ECB council member Knot stated on Friday that there are some upside risks slipping into the inflation outlook, although he is one of the more hawkish members of the council. He added that the ECB is absolutely capable of controlling inflation. The Euro was unable to make any further headway after the European open with no further attack on the 1.2200 level against the US currency as the dollar short-covering kicked in.

The University of Michigan consumer confidence index strengthened to 86.4 for June from 82.9 from previously and above consensus forecasts of 84.0. There was a small improvement in the current conditions component and a larger gain for the expectations index.

The one-year inflation expectations index declined to 4.0% from 4.6% the previous month while the 5-year index edged lower to 2.8% from 3.0%.

The US dollar continued to gain ground later in the session with the Euro dipping to just below the 1.2100 level as the US currency secured wider support on short-covering while commodity currencies posted significant net losses into the close as overall volatility increased.

There was little change in long Euro positions according to the latest CFTC data with the Euro vulnerable to a sharp adjustment if there is a dip in risk appetite. The data also illustrated that there is scope for significant dollar short-covering if confidence in a weaker dollar declines. In this context, there was caution ahead of Wednesday’s Federal Reserve policy decision given the possibility of a more hawkish statement and shift in the timing of an expected rate hike. The dollar held a slightly firmer tone on Monday with the Euro fractionally below 1.2100 as ECB President Lagarde reiterated that it was too early to discuss any reduction of bond purchases.




The dollar posted net gains in the New York session on Friday with a peak of around 109.85 against the yen. US yields failed to hold peak levels during the day and the US edged lower to 109.70 at the New York close.  CFTC data recorded a decline in short yen positions to 37,000 in the latest week from 47,000 previously which suggested a slightly more cautious tone surrounding risk conditions during the week and a reluctance to sell the Japanese currency.

Chinese markets were closed for a holiday on Monday which dampened trading volumes and curbed activity. Markets will continue to monitor rhetoric from Beijing officials closely in the short term given potential resistance to further yuan gains which would help underpin the US currency.

There should be no comments from Federal Reserve officials ahead of Wednesday’s policy decision, although markets will be wary over any unofficial briefings.

Overall yen sentiment remained weak with the dollar trading around 109.75 and the Euro below 133.00.




Sterling was unable to gain any significant support from the UK data releases on Friday. The GDP data was close to expectations as weakness in the industrial sector offset a rebound in services. The latest NIESR report estimated that GDP increased 1.5% for May following the 2.3% gain for April with a further 0.9% advance for June which would give an annual increase of 16.1%, but there were still reservations over the underlying economic trends.

Markets were also wary over an expected delay to the re-opening measures on June 21st. Prime Minister Johnson is due to make a decision on Monday.

The UK currency held a firm overall tone, although to an important extent this was due to a lack of confidence in the Euro and dollar rather than any great enthusiasm for Sterling. The UK currency retreated to lows around 1.4100 against the dollar with the Euro trading around 0.8585.

There were some underlying concerns over Brexit tensions, although G7 leaders attempted to focus elsewhere which limited the potential currency impact. There were further reports that the planned final easing of business restrictions on June 21st would be delayed for four weeks. Sterling held just above 1.4100 against the dollar on Monday with the Euro edging lower to 0.8575 as global equity markets held steady.




The Euro was unable to make headway against the Swiss franc on Friday and retreated to the 1.0880 area amid wider single-currency losses. The dollar was able to make headway and strengthened to highs around 0.9000. The franc continued to gain underlying support from expectations of higher global inflation rates.

Expectations of accommodative policies from the ECB and Federal Reserve also continued to provide underlying support. The National Bank is expected to maintain an unchanged policy stance at this Thursday’s policy meeting. The franc was marginally lower on Monday, although the dollar was capped below 0.9000.



Technical Levels 


Today's Events 



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...

Weekly Report FX Options

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

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.

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.