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7 Oct 2013
Flash: FX price action consistent with heightened risk aversion - BMO Capital Markets
Greg Anderson, Global Head of FX Strategy at BMO Capital Markets notes that overnight price movement in FX markets is consistent with heightened risk aversion as local news is minimal in most G10 markets.
Key Quotes
“Noteworthy ‘risk-off’ moves include EUR/CHF lower, AUD/JPY lower and EUR/SEK higher. Looking at individual currencies, JPY has been the best performer, up about 0.6%. Consistent with a risk-off theme, the second best performer is CHF, which is up about 0.4%.”
“On the negative side, the worst performers are AUD, CAD, NOK, NZD and SEK, which are both down about 0.3%. These are small moves so the extent that markets are growing nervous about the US fiscal situation shouldn’t be exaggerated, but that clearly is coming in to play.”
“With that in mind, it is interesting that EUR/USD is stuck in the middle, with almost no price movement on the day. To be fair, it took a run at 1.3600 earlier this morning but slid back without reaching that plateau.”
“Price action from Friday and today is consistent with a market that is already substantially long of EUR/USD and is unsure what to do at this point with the FX market’s most actively traded pair.”
Key Quotes
“Noteworthy ‘risk-off’ moves include EUR/CHF lower, AUD/JPY lower and EUR/SEK higher. Looking at individual currencies, JPY has been the best performer, up about 0.6%. Consistent with a risk-off theme, the second best performer is CHF, which is up about 0.4%.”
“On the negative side, the worst performers are AUD, CAD, NOK, NZD and SEK, which are both down about 0.3%. These are small moves so the extent that markets are growing nervous about the US fiscal situation shouldn’t be exaggerated, but that clearly is coming in to play.”
“With that in mind, it is interesting that EUR/USD is stuck in the middle, with almost no price movement on the day. To be fair, it took a run at 1.3600 earlier this morning but slid back without reaching that plateau.”
“Price action from Friday and today is consistent with a market that is already substantially long of EUR/USD and is unsure what to do at this point with the FX market’s most actively traded pair.”