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  • Mike Paterson

Euro lower as Putin steals some headlines

Wednesday 21 September 2022

Focus mainly on the US Fed FOMC interest rate decision tonight followed by the BOJ, SNB, BOE, Norges Bank, and SARB tomorrow but Russia's Putin has stolen some of the attention with his threat of escalating efforts in the Ukraine war. I've been posting this warning here lately "Ukraine/Russia war still a very large elephant in the room if we look past central banks' fight against inflation" and now very much to the fore as risk sentiment and the Euro take a hit. China's Yuan dropping further too.

Equity markets still treading water ahead but off their lows following yesterday's retreat. Gold still steady/ranging tightly for the moment but Oil higher on the risk of supply issues following Putin's comments.

GBPUSD: Another retreat yesterday that finally broke through the 1.1350-60 support amid the Putin/risk-off impact but holding 1.1300 so far. Patience a virtue still but I prefer rally sell side still. EURGBP: More two-way business in the past 24 hours but softer again amid the Putin-led EUR supply.BOE tomorrow still casts a shadow too. GBPJPY: Capping at 164.00 this time amid the softer risk tones but holding 162.30 so far.

EURUSD: Finding support around 0.9880 so far after the Putin-led retreat but still looking fragile with rallies limited to 0.9920 as I typE and I remain a rally seller as my preferred side. USDJPY: Finding support into 143.30 after capping at 144.00 amid the softer risk tones. Still not convinced the bullish trend has ended but still preferring the rally-sell side overall. Definitely expecting more 2-way business.FOMC and BOJ casting their shadow too ofc. EURJPY: Support now at 142.00 after failing at 143.50 amid softer risk tones. Expect some two-way business still but looks soft. USDCHF: Holding 0.9630 still after capping at 0.9680 as EURCHF retreats again. Some natural CHF demand still but SNB still keeping an eye on matters ahead of tomorrow's decision. EURCHF: Now broken down through 0.9630 amid the EUR sell-off and now capped at 0.9600 by some general risk-off CHF demand too. SNB in focus.

AUDUSD: Now capping at 0.6700 amid the softer risk tones and AUDJPY supply but holding around 0.6650 in the retreat as I type. GBPAUD once again finding 1.6980-00 area a base but with sellers capping at 1.7050-60 now. NZD continues its journey lower and now posting fresh recent lows of 0.5880 amid the firmer USD/softer risk. GBPNZD supported at 1.9250 as I type amid the soggy NZD sentiment but sellers poised. USDCAD: Decent support coming at 1.3350-60 after the break up through 1.3340 but capped amid some firmer oil tones and CADJPY supply on the Putin threats.

Let's continue to be careful out there.

Interbank rates: 08.52 BST

GBPUSD 1.1335

EURUSD 0.9911

EURGBP 0.8743

GBPEUR 1.1435

GBPJPY 163.00

GBPCAD 1.5165

GBPCHF 1.0940

GBPZAR 20.0865

GBPHKD 8.8298

USDJPY 143.74

EURJPY 142.50

EURCHF 0.9590

EURHKD 7.7218

AUDUSD 0.6670

NZDUSD 0.5888

USDCAD 1.3376

USDCHF 0.9678

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