All Eyes on the Euro's Movement Following ECB President Lagarde's Dovish Remarks
08.02.2022
- U.S. NFIB Small Business Optimism Index
- Canada: Trade Balance
In the previous day’s U.S. currency trading, the Australian dollar rose from 0.706 to 0.713 against the U.S. dollar, driven by surging Oceania currencies.During today’s Asian session, the pair is similarly testing higher levels. Meanwhile, the GBP/USD pair lacks a clear direction and is trading in a range between 1.349 and 1.355.However, as Asian trading began today, the USD/JPY pair rose by about 50 pips from 114.91 to 115.41, driven by the rise in the U.S. 10-year Treasury yield to 1.93%.
European currencies are facing resistance on the upside following yesterday’s clearly dovish remarks by ECB President Lagarde—who stated that “interest rate hikes will not come before the end of asset purchases”—and the EUR/USD pair has shifted to trading within a very narrow range of 1.141–1.146.If this gradual decline continues, we would like to position ourselves for a decline with some room to fall, down to around 1.137, which is the 10-day moving average on the daily chart.
Today, the French trade balance and current account balance are scheduled for 16:45 European time; the U.S. NFIB Small Business Optimism Index is scheduled for 20:00; and once U.S. trading hours begin, the Canadian trade balance and U.S. trade balance are scheduled for 22:30, followed by the U.S. 3-year Treasury auction at 27:00.We will be closely monitoring whether the rising USD/JPY pair will test further upside.
Author: Keisuke Sakurai
