June 4: Asian session
EUR/USD tested levels above $1.3100 yesterday, but today opened below this handle. Weaker than expected ISM data from the US is thought to be the main driver of Monday’s move. Today watch for Spanish unemployment change and US trade balance. Volatility will remain high ahead of the ECB rate decision on Thursday and American employment data on Friday.
USD/JPY recovered to 99.90 after having dipped on downbeat US data to 98.85 yesterday. GBP/USD spiked to $1.5375 and 8is now trading just above $1.5300. UK will release construction PMI today after yesterday it published encouraging manufacturing PMI. USD/CAD slid to 1.0260, but today recovered and approached 1.0300 once again. Canadian dollar gained the most in almost a year against its US counterpart. USD/CHF recovered to 0.9490 after the yesterday’s dip to 0.9400.
AUD/USD is trading in the red around $0.9730 after a dip below $0.9700 earlier in the day. As expected, the RBA left interest rates on hold at 2.75%. RBA statement showed that the regulator still sees the Aussie overvalued and there is some scope for further easing if needed to support demand. Australia’s Q1 Current Account came at -8.5B vs. -9B expected. Yesterday’s attempts to rebound were capped by the $0.9800 mark. NZD/USD slipped to $0.8060 following a test of the levels above $0.8100 on Monday. New Zealand Treasury announced today that drought is expected to reduce GDP by 0.7% in 2013.