All eyes are on whether the central bank governor’s remarks at the ECB Forum will signal a shift in the yen’s weakening trend

All eyes are on whether the central bank governor’s remarks at the ECB Forum will signal a shift in the yen’s weakening trend

28.06.2023

In U.S. currency trading the previous day, the U.S. dollar fell against the euro despite the Dollar Index temporarily rising to 102.6. The EUR/USD pair rose by approximately 70 pips from 1.0902 to 1.0975, forming an uptrend along the 10-period moving average on the hourly chart.During today’s Asian session as well, the EUR/USD pair is showing a rebound, supported by the 20-period moving average on the hourly chart; therefore, we will be closely monitoring whether the U.S. dollar’s decline continues during the European session.

European currencies saw the euro emerge as the strongest currency after ECB President Lagarde stated in her keynote speech at yesterday’s ECB Forum that “unless there are significant changes to the outlook, we will continue raising interest rates in July.” The euro/yen pair rose to 157.935.It has remained at levels not seen in 15 years, since the Lehman Shock in September 2008. During today’s Asian trading session, the 20-period moving average on the hourly chart is providing solid support, but with key officials’ remarks coming up later, traders should remain cautious about the direction of the market.

Today’s economic indicators include the German GfK Consumer Confidence Survey at 15:00, the French Consumer Confidence Index at 15:45, the Eurozone M3 Money Supply at 17:00, remarks by MPC member Pill at 19:30, the U.S. MBA Mortgage Applications Index at 20:00,9:30 PM: U.S. Wholesale Inventories; 10:30 PM: Remarks by Bank of Japan Governor Ueda, remarks by Bank of England Governor Bailey, remarks by ECB President Lagarde, and remarks by Federal Reserve Chair Powell; 11:30 PM: U.S. Weekly Crude Oil Inventories;and at 26:00, a U.S. 7-year Treasury auction is scheduled. We will be closely monitoring whether comments from central bank governors at the ECB Forum lead to shifts in currency strength.