The index has extended post-FOMC gains to just over 95.000, but the Greenback is not bid across the board by any means even though some rebalancing models for the end of September are pointing to a mild bid.
All bucking the general trend and up vs the Usd, with the Loonie rebounding towards 1.3000 and perhaps deriving some encouragement from BoC’s Poloz who remains hopeful of a NAFTA deal. Meanwhile, the Aud is outperforming down under and holding above 0.7200 amidst hefty option expiry interest from 0.7215-25 (2.2 bn) to 0.7230-50 (1.1 bn) and the Franc has regained some composure after recent declines to trade within a 0.9755-75 range.
The major laggards, as the single currency continues to bear the brunt of Italian budget concerns that have intensified following the coalitions Government’s decision to test the EU boundaries with a 2.4% deficit for 2019. Eur/Usd is only just holding around 1.1600 having breached a series of chart supports and the 30 DMA at 1.1646. Cable is also looking precarious close to its 21 DMA and double bottoms all around 1.3055 following a brief dip below on the back of weaker than forecast UK GDP data. Usd/Jpy has broken higher again, and more convincingly through a tech level at 113.24, which could be pivotal on a closing basis given month, quarter and Japanese half year end. The Kiwi looks hampered by ongoing RBNZ policy neutrality and also anchored by a big option expiry at the 0.6600 strike.
More upside and outperformance for the 2 Scandi crowns with impetus from solid or even stellar Norwegian and Swedish retail sales data, as Eur/Nok drops towards 9.4750 and Eur/Sek trades just below 10.2900.