Forex news from the European trading session – 22 May 2020
- JPY leads, AUD lags on the day
- European equities a little lower; E-minis down 0.3%
- US 10-year yields down 2 bps to 0.65%
- Gold up 0.5% to $ 1,735.04
- WTI down 5.6% to $ 32.00
- Bitcoin up 1.0% to $ 9,149
Hong Kong-China tensions stoked the risk-off flames in European morning trade, as worries surrounding Beijing’s legislative action grew in fear that it could lead to a further dispute between US and China among other ongoing issues between the two.
As such, equities sold off with China deciding against setting a GDP target for this year not really helping with market sentiment in general as well.
The Hang Seng settled for a drop of over 5% and that weighed on European stocks and US futures for a bit, before the over 1% losses are slowly being shed in the past few hours.
In the major currencies space, the dollar and yen continued to keep firmer during the session as both currencies advanced against the rest of the bloc.
Cable fell to fresh four-day lows from 1.2210 to 1.2162 while EUR/USD also eased from 1.0920 levels to just under 1.0900 before settling near the figure level now.
The aussie is the laggard, dropping from 0.6540 to a low of 0.6512 before recouping some of the decline. Meanwhile, the loonie is pressured with USD/CAD resting above 1.4000 as weaker oil prices are also not really helping on the day.
With stocks paring their decline, it is going to be interesting to see if the market will turn things around ahead of the weekend. Just be reminded that it will be a long weekend in the US in observance of Memorial Day on Monday.