- China stock market freezing up as sell-off gathers pace.
- SSEC closed down 5.9% & Hang Seng closed down 5.8% on Wednesday.
- Yen hits 6-week high on safe haven flows. USD/JPY trading from 121.41 to 122.55.
- Euro up slightly as Greece gets new deadline.
- AUD/USD hits new 6 year low at 0.7372 from 0.7459.
- Greece makes formal request for load from ESM.
- ECB Noyer- Euro is not condemned without Greece.
- Nowotny- Questions for Greek bridge finance not current while no new bailout plan.
- UK Osborne to cut spending in Conservative's post-election budget.
- UK June Halifax house prices 1.7% m/m vs previous 0.3% revised. 0.3% expected.
- UK Halifax house prices 9.6% y/y in 3M to Jun vs previous 8.6%. 8.3% expected.
- BOJ Board member Kiuchi- Sees little chance of JP hitting 2% inflation even by fiscal 2017.
- House prices 30% undervalued. Buy, don't rent, says RBA official.
- (1030 ET/1430 GMT) EIA petroleum statistics.
- (1100 ET/1500 GMT) Turkey Ipsos Primary Consumer Sentiment Index previous 54.99.
- (1100 ET/1500 GMT) Kansas City Fed Labour Market Conditions Indicators (June).
Key Events Ahead
- (1145 ET/1545 GMT) FedTrade operation 30-yr Fannie Mae / Freddie Mac (max $2.200 bn).
- (1400 ET/1800 GMT) FOMC Minutes (from meeting of June 16-17).
- (1400 ET/1800 GMT) FRB San Francisco's Williams on the economic outlook; LA.
FX Recap
EUR/USD is supported above 1.1000 levels and currently trading at 1.1042 levels. It has made intraday high at 1.1059 and low at 1.0972 levels. Yields on Greek bonds rocketed on Wednesday as the country nears Sunday's deadline to avert an exit from the currency zone. The moves happened as nobody knows whether European Union leaders will be able to find a way to keep Greece in the common currency zone. Greece's fate will be sealed at yet another emergency summit of European leaders on Sunday, attended by all 28 leaders - not just from the euro zone. Euro zone finance ministers will be holding a conference call later in the day to discuss Greece's request for a loan from the European Stability Mechanism. Initial support is seen around at 1.0914 and resistance at 1.1171 levels. Option expiries are at 1.0950 (506M), 1.1000 (287M), 1.1050 (684M).
USD/JPY is supported below 122.00 levels and posted a high of 122.55 levels. It has made intraday low at 121.34 and currently trading at 121.44 levels. The yen touched a 6-week high against the dollar on Wednesday, after Chinese stocks struggled to pull out of a tailspin, pushing investors already shaken by Greece's debt crisis to seek out safe havens. It gained 0.9 percent versus the dollar to 121.45. The yen succeed to hold early morning gains amid Greece's uncertain future as the greenback found some ground on technical support, while the US trade deficit stabilized in May. The major erased gains seen in the last US session and fell back in red as the latest Greece developments coupled with China shocker spurred safe-haven bids for the Japanese currency. Better than expected current account data from Japan also bolstered the yen further. Japan's current account reached a surplus of trillion, better than the trillion seen. Looking ahead, the Federal Reserve is scheduled to publish minutes from its most recent meeting on Wednesday. Additionally, Fed Chair Janet Yellen is set to speak on Friday. Near term resistance is seen at 124.57 and support is seen at 120.63 levels. Option expiries are at 122.00 (511M), 123.50 (320M).
GBP/USD is supported around $1.5400 levels. It made an intraday high at 1.5466 and low at 1.5388 levels. Pair is currently trading at 1.5392 levels. The pair is trading below 1.5408, threatening to fall below 1.54 handle as markets believe more fiscal consolidation could delay BOE's plans of a rate hike. The UK government is widely expected to announce more measures aimed at fiscal consolidation. The UK Chancellor George Osborne will present 'Summer Budget' on Wednesday at 1130 GMT, during which he will sketch the details of his plans on reducing fiscal deficit during the current parliament. Ahead in the day, the pair could be influenced by the UK budget statement and the Fed minutes. Initial support is seen at 1.5367 and resistance is seen around 1.5737 levels. Option expiry is at 1.5550 (308M).
USDCHF is supported above 0.9400 levels and trading at 0.9422 levels and made intraday low at 0.9408 and high at 0.9475 levels. Pair is trading on flat bias as Switzerland's unemployment rate released with Flat numbers at 3.3% yesterday. Today is data thin calendar for Switzerland. Market will eye on FOMC meeting minutes for the further direction. Near term support is seen at 0.9341 levels and resistance is seen at 0.9500 levels.
AUD/USD is supported around 0.7400 levels and trading at 0.7416 levels. It has made intraday high at 0.7458 levels and low at 0.7371 levels. The Australian currency continued the downward trend and traded at its 6-year low as US dollar bulls woke up in fighting mood ahead of the FOMC latest minutes set to be released later in the US session. The situation in Greece will also be highly watched. Following yesterday's talks, EU President Donald Tusk said the final deadline to reach a deal ends this week. Initial support is seen at 0.7360 and resistance at 0.7647 levels. Option expiries are at 0.7400 (367M), 0.7445-50 (400M).
