EUROPEAN FX UPDATE: Choppy USD session thus far on spot month end.

USD: DXY U/C; 99.71

• A choppy session for the Dollar on spot month end in what has been the quiet before the storm in terms of news flow thus far, with the rest of the week packed with risk events including the first look at Q1 US GDP and the US labour market report.


• There has been minimal major and new tariff news, but US consumers may soon feel the impact given further price altering reports filtering through, i.e. Shein raised prices by up to 377%, citing a logistics slowdown in air freight and imports.


• Elsewhere, WSJ's Timiraos downplayed Fed's Hammack comment that was made on Thursday about how the Fed could move in June if the data is clear about the state of the economy, in which Timiraos said she made it clear she was talking about any number of points in the future and not just June.


• DXY currently resides in a relatively tight 99.46-99.84 range and within Friday's 99.40-99.88 parameter.

EUR: EUR/USD -0.2%; 1.1342

• Subdued, albeit marginally, against the backdrop of a string of relatively dovish ECB rhetoric.


• ECB policymakers reportedly are becoming increasingly confident about a rate cut in June although there is little to no appetite for a big move, according to six sources cited by Reuters. It was also reported that the central bank established a task force to simplify banking regulation.


• Desks suggest the ECB may also be concerned about euro strength: nominal trade-weighted euro at record highs, up 4% Y/Y.


• Data this week includes Q1 GDP and April Flash CPI.


• EUR/USD resides in a 1.1330-80 range and within Friday's 1.1315-1.1394 confines.

JPY: USD/JPY U/C; 143.63

• Flat trade for the JPY amidst a lack of major updates over the weekend.


• US Treasury Secretary Bessent met with Japanese Finance Minister Kato on Thursday and held productive discussions across a broad range of bilateral issues including reciprocal trade, while he was said to be encouraged by discussions with South Korean officials that focused on an ‘expanded equilibrium’ which encourages rather than restricts trade.


• Markets gear up for the BoJ policy announcement this week - where the central bank is widely expected to maintain its interest rate at 0.50% as a recent Reuters poll showed 84% of economists surveyed expect the BoJ to keep its key interest rate at the current level through to end-June.


• USD/JPY resides in a 143.29-143.90 range at the time of writing vs Friday's 142.59-144.03 range.

GBP: GBP/USD -0.1%; 1.3306

• Relatively flat/subdued in a quiet session thus far to start the week.


• In terms of UK trade headlines, UK Chancellor Reeves said she met with US Treasury Secretary Bessent, saying the goal is reaching an agreement that is in both their national interests. Furthermore, BoE Governor Bailey and US Treasury Secretary Bessent held discussions on financial markets and the regulatory environment.


• GBP/USD trades in a 1.3280-1.3328 range, within Friday's 1.3274-1.3347 range.

Antipodeans: AUD/USD -0.4%; 0.6367. NZD/USD -0.5%; 0.5931

• Lower intraday amid the cautious risk tone alongside ongoing tariff uncertainty between the world's two largest economies, whilst domestic updates have been light.


• Chinese President Xi and US President Trump have not had a call recently, according to China's Foreign Ministry; says the US and China have not conducted negotiations and consultations on tariffs.


• Following the Politburo statement on Friday, which flagged further interest rate cuts, a Reuters source close to the PBoC said it was in no rush to trim rates as the impact of tariffs is still unclear, but if data starts to deteriorate in coming months, the PBoC, "the central bank will certainly roll out monetary stimulus".


• AUD/USD dipped under Friday's trough (0.6374) in a 0.6369-0.6406 intraday range with Thursday's low at 0.6344.


• NZD/USD reached lows last seen a week ago, with the 200 DMA to the downside at 0.5885.

28 Apr 2025 - 10:00- ForexData- Source: Newsquawk