In the wake of BoE's decision to maintain interest rates unchanged, Sterling exhibited a mixed performance, gaining against Dollar yet faltering when paired with the Euro and commodity-linked currencies. The voting pattern at the BoE leaned slightly more hawkish than anticipated, but the newly projected rate path suggests the peak in interest rates was reached already. The Dollar, on the other hand, is losing ground, exacerbated by a further dip in 10-year yield, now below 4.7% mark. This development is mirrored in US stock futures, which are signaling positive opening. Currently, Dollar is the third weakest performer of the week, managing only marginal gains over Yen and the Swiss Franc. However, its position remains precarious. In contrast, Australian Dollar leads the pack as the week's strongest, followed by New Zealand Dollar and Euro. Canadian Dollar shows a mixed performance, while Sterling struggles to keep pace with its peers. Technically, EUR/USD is back pressing 55 D EMA with today's strong bounce. Strong break of this EMA and 1.0693 resistance will carry bullish implication. Further rise should at least be seen to 1.0764 cluster resistance (38.2% retracement of 1.1274 to 1.0447 at 1.0763). However, rejection by 55 D EMA will keep near term outlook bearish for another fall through 1.0447, soon. In Europe, at the time of writing, FTSE is up 1.24%. DAX is up 1.60%. CAC is up 1.94%. Germany 10-year yield is down -0.085 at 2.680. Earlier in Asia, Nikkei rose 1.10%. Hong Kong HSI rose 0.75%. China Shanghai SSE dropped -0.45%. Singapore Strait Times rose 0.19%. Japan 10-year JGB yield dropped -0.0433 to 0.916. |
