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Market Movers: USD hammered after retail sales – TDS

FXStreet (Barcelona) - Prashant Newnaha, Strategist at TD Securities, summarizes the Forex and Fixed income market performance during the Asian trading session, noting that USD continued to remain weak in the G10 space while NZ data led NZD to outperform yet again.

Key Quotes

“The USD was hammered on the retails sales miss overnight, down close to 1% and while weaker by around 0.2% vs the G10 in Asia, the DXY is off a mild 0.1%.”

“The NZD is again the outperformer today, bolstered by a hot Q1 retail sales release which should take some of the heat out of RBNZ cuts, at least in the near term. The NZD is currently +0.65% at US$0.7530, clocking up a 2 day gain of +2.3%.”

“The Scandies and the CAD are +0.2%, the AUD +0.15% at US$0.8130 and the EUR +0.10% at US$1.1360.”

“There were some sharp shifts and reversals in sentiment in fixed income space overnight, but with the US session closing on a weak note this pressured ACGB and NZGB yields higher. 3yr ACGBs are unchanged at 2.14%, 10yrs have found a level around 3%, +5.5bps, NZGB 2yrs are +3bps and NZGB 10s are +8bps, keeping intact the steepening bias.”

“Over in equities, China/HK are really the only markets managing to keep their heads above water, +0.2%, in contrast to most other regional indices that are down—the NKY –1%, ASX –0.5%, Sensex –0.25%."

“Most commodities are not far off US closing levels, gold near US$1215, brent is flat at US$66.80, copper off 0.15%. Iron ore is the exception, down 3.8% for Sep delivery.”

EUR/USD consolidates circa 1.1360

The shared currency remains boosted versus the US dollar in the early European trades, keeping EUR/USD in highs within reach of 1.14 handle. The main currency pair remains supported largely on shrinking bonds’ spread while broad US dollar weakness backed by worse-than expected US retail trade data also keeps the major underpinned.
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