Healthy PMIs In Asia And Moderna News Fuel Global Growth Narrative

After a modest ricochet off 1.20 yesterday, the is again on the back foot alongside rising risk appetite. There have been few meaningful policy developments, but healthy PMIs in Asia and news that Moderna (NASDAQ:) has requested FDA approval for its vaccine have rocket-fuelled the global growth upswing narrative.

Today, the focus shifts to Fed Chair Powell’s to the Senate Banking Committee. The text of his prepared comments, released yesterday, covered very familiar ground. But they provided a stark reminder of economic concerns and challenges faced by US policymakers. markets seemed to like that reminder and the implications it may have for future policy concerns.

EUR/USD is again teasing with a break above 1.20, focusing on risk appetite rather than the economic data, so it seems. Yesterday’s move through 1.20 proved brief and prompted a marked reversal towards 1.1920. However, the bounce in equity markets has been echoed in renewed USD weakness and side B EUR buying

The AUD has failed to keep pace with other parts of G10, failing to make much progress despite a risk-on mood in stock. I suspect the escalating Australia -China trade spat is creating a touch of buyer fatigue. Yesterday, EUR/USD failed to hold above 1.20, failed to break below support at 1.1920, and could not sustain the shift above 0.74. All three currencies weakened against the USD as a result, but while the EUR and CAD have recovered the bulk of that reversal, the AUD has languished