EUROPEAN FX UPDATE: DXY subdued and contained whilst havens seen some inflows amid the broader mood

USD DXY -0.2%; 101.53

• Subdued and contained within Wednesday's confines amid a lack of fresh catalysts overnight.


• Attention on Thursday turns to Fed Chair Powell and US data for April, namely, PPI, Retail Sales, Initial Claims, Industrial Production, and Philly Fed Business Index (May).


• US retail sales are expected to be unchanged M/M in April (prev. +1.5%), with the ex-autos measure seen +0.3% M/M (prev. +0.6%)%, and the control group seen +0.3% M/M (prev. +0.4%). Bank of America's monthly consumer checkpoint data showed April card spending per household +1% Y/Y (prev. +1.1% in March), with seasonally adjusted monthly spending flat in the month. It said that slower spending growth reflected both easing inflation and fewer transactions, especially on high-cost discretionary services like travel. Lower-income households lagged behind due to weaker wage growth, though lower oil prices may help. BofA added that most consumers remain financially sound, with more paying off credit cards monthly, but a rise in minimum payments signals growing pressure for some.


• DXY resides in a 100.58-101.05 range at the time of writing, within yesterday's 100.27-101.14 parameter.

EUR: EUR/USD +0.2%; 1.1200

• Ekes mild gains and trades on either side of the 1.1200 level after recent fluctuations, and with ECB speakers scheduled later, although data and speakers today are not likely to shift the dial much.


• "We see EUR/USD trading in a 1.11-1.15 range over the coming weeks and months, although risks are skewed to the upside. 1.1265 is now decent intra-day resistance.", says ING.


• EUR/USD trades in a 1.1170-1.1228 range at the time of writing, and within yesterday's range of 1.1164-1.1265.

JPY: USD/JPY -0.6%; 145.86

• USD/JPY retreated overnight as the underperformance in Japanese stocks spurred some haven flows into the yen.


• European session saw little in the way of fresh macro catalysts, although the gains in havens are in-fitting with the broader mood across the market.


• USD/JPY resides on either side of its 50 DMA (146.18) in a current 145.49-146.75.

GBP: GBP/USD +0.3%; 1.3210

• Modestly firmer amid the softer Dollar and on the back of better-than-expected UK GDP data.


• Data out of the UK showed GDP growth of +0.2% M/M in March (exp. 0.0%), and the annual rate pared to +1.1% Y/Y (exp. 1.0%, prev. 1.4%); the 3M/3M estimate rose to 0.7% in March (exp. 0.6%, prev. 0.6%). That leaves the preliminary estimate for Q1 GDP at 0.7% Q/Q (exp. 0.6%), and the annual rate of growth at 1.3% Y/Y in Q1 (exp. 1.2%, prev. 1.5%). The UK stats office noted that the economy grew strongly in Q1, mainly driven by broad-based services growth, including wholesale, retail, computer programming, car leasing, and advertising; production also rose significantly after prior decline, but slight falls were seen in education, telecoms, and legal services.


• Ahead, BoE's Dhingra is to speak on "EU macroeconomic policy in an age of shocks", with a text release.


• GBP/USD resides within yesterday's 1.3250-1.3360 range.

Antipodeans: AUD/USD -0.1%; 0.6418. NZD/USD -0.1%; 0.58888

• Subdued in-fitting with the broader risk tone.


• Mild support was seen in AUD/USD following the stronger-than-expected employment data from Australia.


• AUD/USD resides in a 0.6415-57 range at the time of writing, with NZD/USD in a 0.5883-0.5916 range.

15 May 2025 - 09:55- ForexData- Source: Newsquawk