Market participants may be on alert for sudden fluctuations in the euro following the release of the ECB meeting minutes

Market participants may be on alert for sudden fluctuations in the euro following the release of the ECB meeting minutes

01.06.2023

In yesterday’s U.S. trading session, the Canadian dollar saw mixed trading against the yen following the release of first-quarter GDP data, which improved from the previous reading of 0.0% to 3.1%. The CAD/JPY pair fluctuated between 102.136 and 103.000, trading above and below the 20-period moving average on the hourly chart.In today’s Asian session, CAD/JPY is aiming higher and has recovered to 102.937. We will closely monitor whether the Canadian dollar continues to strengthen against the yen heading into the U.S. session.

European currencies fell sharply against the yen, led by the euro, which dropped significantly after Germany’s May CPI, released yesterday, fell sharply from 7.2% to 6.1% year-on-year.The euro/yen pair fell by approximately 140 pips, from 150.082 to 148.621. This was one of the sharpest declines among the yen crosses. With the rate of decline in European CPI accelerating, attention is focused on today’s remarks by ECB President Lagarde. We will carefully assess the likelihood of the next rate hike based on the release of the ECB meeting minutes and the president’s comments.

Today’s schedule includes the UK Nationwide House Price Index and German retail sales at 3:00 PM, the Swiss Manufacturing PMI and remarks by SNB Governor Schlegel at 4:30 PM, the UK Manufacturing PMI at 5:30 PM, the Eurozone Consumer Price Index and unemployment rate at 6:00 PM, and remarks by ECB President Lagarde at 6:30 PM.at 8:30 PM, the release of the Eurozone ECB meeting minutes; at 9:15 PM, the US ADP National Employment Report; at 9:30 PM, US initial jobless claims; at 10:45 PM, the US Manufacturing PMI; at 12:00 AM, US weekly crude oil inventories; and at 2:00 AM, remarks by US Federal Reserve Bank of Philadelphia President Harker.We should be on guard for sudden price movements in the euro following the release of the ECB meeting minutes.