EUR / USD, GBP / USD
On Tuesday, the euro and the pound fell under a sell-off once again. However this time, the trade figure, or the lack thereof, was the US data on the open vacancies in the labor market for June which was at 6.163 million against expectations of 5.775 million with an increase from May's data of 5.702 million. The index has been shown to be high. However, the market earlier has never reacted so violently to the data. We believe that this was just an excuse to reposition the major players. The volumes were comparable to the closing prices of the US GDP data, construction spending, and consumer income. Now, the market is spreading the opinion that the symposium on August 24-26 in Jackson Hole by Mario Draghi will reveal the announcement of the ECB's incentives. This, of course, is the hope of the euro. However, proceeding from the current events, it can be assumed that this will be their breakdown and will be a loss of money. It is an ideal situation that will be created for the purpose of volumetric purchases of the US national debt. It is important to note that the euro did not react to the good trade balance between Germany and France. The German Trade Balance in June increased from 20.3 billion euros to 21.3 billion euros. The French, however, declined from -4.4 billion to -4. 7 billion with the forecast even worse at -5.1 billion euros. In the US, the optimism index for small businesses increased in July from 103.6 to 105.2.
Today, the US data on labor costs for the second quarter had a forecast of 1.1% following the optimistic prediction of 2.2% in the first quarter. The final estimate of wholesale inventories for June is expected to remain unchanged at 0.6%. Also, investors can keep the dollar strong against the background of today's auction of the US Treasury for 10-year government bonds. We expect a higher demand due to increased political instability.
We are waiting for the euro at 1.1650 until 1.1570 while for the pound sterling, we are waiting in the range of 1.2810 / 30.
USD / JPY
The geopolitical situation around North Korea is getting worse. The media is already talking about the possibility of a preventive strike by the United States on the DPRK. Pyongyang said in response that they are preparing a strike against Guam. Trump responded with "fire and fury" according to his official statement. Actually, this "dialogue" was the reason why the yen fell by 42 points yesterday. Today, the yen lost the same amount in the Asian session. Meanwhile, the Japanese Nikkei 225 index collapsed by 1.36%. The South Korean Kospi SEU declined by 0.94% while China A50 is down by 0.08%.
Good economic Japanese performance can no longer keep the yen from falling. The index of leading economic indicators for June showed an increase from 104.6% to 106.3%. The balance of payments for June was 1.52 trillion yen against the forecast of 1.51 trillion and the data of 1.40 trillion in May. The growth of bank lending remains at 3.3% y / y. The auction for 30-year government bonds was the largest in volume since March last year. The monetary base of M2 has increased from 3.9% y / y to 4.0% y / y.
A little bit of an off situation was today's Chinese CPI which showed a decline of 1.4% y/y against expectations of 1.5% y/y.
The support is at 110.00. This is where investors began to gain volume and was broken. Now, we are waiting for the price at 108.70.