Daily FX Wrap: The USD Index takes another hit, led by cable but followed up in the rest of the majors. Support coming in ahead of the London close as FOMC risk contains.
A busy session in FX today, with a fresh round of USD sales, led primarily by cable but then followed up in EUR, AUD, CAD and to a modest degree, the NZD. USD/JPY dipped below 111.00 again to take out the Monday lows, but ahead of the BoJ meeting on Thursday, there are few willing to sell other than profit takers. For GBP, gains through the 1.4500’s triggered a series of stops, along with those through 1.4600 to lead on to a high of 1.4638. The move stopped short of the Feb highs and has since moved back under 1.4600. EUR/USD followed higher also, to limit EUR/GBP losses, though the cross rate managed to hit a fresh low at .7730 as Brexit plays are still being reversed. EUR/USD however, topped out just ahead of 1.1340 and was back around 1.1300-05 into the London close. US data was mixed through the day, but the main US services PMIs came in above forecasts while US consumer confidence was a touch disappointing. All eyes on the FOMC statement Wednesday though, as players look to see whether a June move is on. In the commodity currencies, USD/CAD held up well in the mid 1.2600’s before oil started to push higher again, but WTI has topped out around $43.60. Support ahead of 1.2600 was tested, but for now, the figure level has held. AUD/USD has pushed back into the mid .7700’s again, but ahead of Australian CPI overnight, there is a reluctance to push too aggressively here.