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Japanese Yen Attempts to Hold Ground After PMI Releases, Concerns About US-China Trade Deal

The main theme for today was the release of PMI reports for various parts of the world, though the topic of the US-China trade deal was also in the news. Overall, markets were in a positive mood, favoring high-beta currencies. Surprisingly, that did not result in a total sell-off of the Japanese currency. The yen fared rather well, holding its ground against most of its rivals and even gaining on some of them.

Australian Dollar Recovers from Daily Lows, Domestic Data Supports

The Australian dollar was weak intraday on Wednesday but has currently recovered and is one of the strongest currencies on the Forex market for the day, rising against most of its major rivals and trading about flat against the rest of them. Domestic macroeconomic data was supportive of the currency while reports in China, Australia’s biggest trading partner, were negative.

Turkish Lira Weakens As May Inflation Spikes

The Turkish lira is weakening against several major currency rivals midweek, primarily caused by the spike in inflation last month that may give policymakers enough fuel to cut interest rates. Investors are also going sour on the lira on Wednesday on new data that suggests the central bank ramped up foreign currency borrowing in April to stabilize the lira.

Euro Rallies on Upbeat Fundamental Releases From the Euro Area

The euro today rallied higher against the US dollar extending yesterday’s gains following the release of upbeat core inflation data from the eurozone. The EUR/USD currency pair capitalised on positive macro reports from across the euro area combined with the greenback’s overall weakness to inch higher.

Euro Hits 8-Week Highs on Investor Optimism, Later Falls Then Rallies

The euro today rallied to new 8-week highs against the US dollar as the bullish sentiment carried over from yesterday’s rally before reversing course and heading lower. The EUR/USD currency pair later fell amid fears of an escalation in US-China trade tensions that could trigger a new trade war before reversing course and heading higher.

Yen Soft on Market Sentiment, Domestic Data, Economic Outlook

The Japanese yen fell against almost all of its most-traded rivals, though not against the US dollar, as the market sentiment was favorable to riskier currencies, not safer ones. Negative domestic macroeconomic data and the gloomy outlook from the Japanese central bank did not help the currency either.

Chinese Yuan Weakens As Government Abandons 2020 GDP Target

The Chinese yuan is weakening against its major currency competitors to end the trading week, driven by officials announcing that they are abandoning their gross domestic product (GDP) target for 2020. The yuan is also coming under pressure on US-China tensions regarding trade and Hong Kong. While the world’s second-largest economy has hit the reboot button, outside factors may pause its reopening.

British Pound Mixed on Sliding Inflation, First-Ever Negative-Yielding Bond

The British pound is trading mixed against its G10 currency competitors midweek as investors comb through the influx of April inflation data. For the first time in the nation’s history, the United Kingdom sold a negative-yielding bond, meaning that the government is being paid to borrow. In the post-Coronavirus economy, this might be the new norm for a myriad of nations around the world.

Aussie Rebounds After Falling on Tensions Between China & Australia

The Australian dollar fell intraday but has rebounded by now. The drop was a result of growing political tensions between China and Australia as well as poor macroeconomic data in both Australia and China.

Swiss Franc Weakens As Manufacturing Slumps, Capped by SNB Intervention

The Swiss franc is weakening on Tuesday as the latest manufacturing figures highlighted an industry that is in a sharp decline. The franc’s slide was exacerbated by the central bank’s foreign exchange interventions to prevent currency appreciation. With Switzerland reopening in the aftermath of the coronavirus pandemic, could the economy rebound in the second half of 2020 and elevate the franc even more?

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