Australian Dollar surges amid weaker US data

Key Movers

There is plenty to digest this morning with price action among the majors showing signs of life after an extended period of narrow moves. A much softer than expected US ISM Services print coupled with an uptick in US jobless claims forced a sharp retracement in US treasury yields and the USD as markets brought forward bets for a Fed rate cut. The DXY dollar index fell 0.35% as commodity currencies led gains. The NOK, SEK and AUD all climbed over half a percent with the NOK and SEK up more than 1% while the euro and GBP both advanced. The euro tested a break above 1.08 marking session highs at 1.0812 before edging back toward 1.0775, closing 40 points higher on the day. The GBP surged through 1.27 to mark highs just short of 1.2780 before correcting back toward 1.2730, up more than 50 points on yesterday’s open. The only laggard for the day was the Japanese yen. The yen allowed the USD to mark new highs at 161.95 before pushing back, forcing the USD back to 161.70, still closing lower through the last 24 hours.

Our attentions now turn to UK polling booths with the UK General Election underway. Anything short of a landslide labour win will come as a major shock and could prompt GBP volatility. In Europe, we look to the ECB June meeting minutes and German factory orders for key macro updates. US markets will be closed in observance of Independence Day.