MEXICO: Rabobank Sees USDMXN At 18.60 On 1-Month View
Jun-13 16:45
* Rabobank attributes much of the recent rally in MXN to renewed energy around the carry trade and...
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FOREX: USD Index Fully Reverses Monday Surge Before Stabilising
May-14 16:44
- Tuesday’s theme of a weakening US dollar extended today, helped lower by major equity benchmarks consolidating their recent strength and headlines surrounding trade talks providing an additional greenback headwind. The US and South Korea agreed to share a mutual understanding of the principles they hold for operating foreign exchange markets and to continue discussions on FX policy. The headlines spurred some USDKRW weakness, which then filtered through to a broader dollar move against G10 peers.
- Price action prompted the USD index to bridge the gap to last Friday’s close, notably eroding the entirety of the US/China tariff reprieve inspired rally to start the week.
- Hardest hit on Wednesday was USDJPY, which has traded in an impressive 206 pip range. The Japanese yen had been trading in a relatively weak manner amid the risk sentiment surge, however, discussions on FX policy being discussed between other administrations prompted some speculative yen appreciation. USDJPY traded as low as 145.61, and was down as much as 1.27% before stabilising. The move did fall just shy of last Friday’s close at 145.37. Amid a broader stabilisation for the greenback, USDJPY has pared roughly half the moves and stands around 146.50 as we approach the APAC crossover.
- Elsewhere, the likes of AUD and NZD are underperforming (down around 0.45%), although they still remain among the best performers in G10 this week. For AUDUSD, Monday’s move lower was considered corrective and another test above 0.6500 today reinforces the underlying bullish tone. Further strength would open 0.6528, the Nov 29 high, although there appears scope for a more protracted recovery towards the US election related highs at 0.6688.
- Thursday’s APAC session will be highlighted by the Australian unemployment report, before the focus turns to UK GDP. In the US, PPI and Retail Sales data are scheduled, which will be followed by Fed Chair Powell speaking.
US TSY FUTURES: BLOCKs: Jun'25 2Y Sale, 10Y Ultra Buy
May-14 16:28
- -6,916 TUM5 103-07.25, sell through 103-07.38 post time bid at 1218:29ET followed by
- +3,500 UXYM5 111-24, post time offer at 1220:20ET
US TSY OPTIONS: BLOCK: Aug'25 10Y Puts
May-14 16:03
- +7,500 TYQ5 108 puts, 36 vs. 109-29/0.26% at 1156:00ET
