Marketwatch EU & UK

Daily Insights
August 22, 2023

US treasury yields remain elevated after reaching their highest level since 2007 as markets await a key speech from Fed Chairman Jerome Powell on Friday in Jackson Hole. The move came despite no real market data or Fed speakers, with much of the move coming at the longer end of the curve. Higher US yields boosted their Japanese equivalent with the yield on Japan’s 10-year JGB climbing to a new nine year high, helping the currency to gain a touch against the US dollar. Despite the rally in US yields, the greenback was not able to benefit with the dollar index slipping, pushing EURUSD through the psychological 1.09 level. The pound also rallied against the under-fire greenback with GBPUSD moving to the top of its recent range, however the pair continues to be capped at its 50-day MA. Currency markets remain muted ahead of the Fed’s annual economic symposium which kicks off on Thursday and will address the theme of “Structural Shifts in the Global Economy.”

China continues to dominate headlines, escalating its defense of its currency, pushing up funding costs to squeeze short positions and setting another new record with a stronger than expected fix for the yuan. The currency has been under pressure for some time now as the economy continues to struggle and the PBoC has cut rates whilst the Fed hikes – widening the yield differential and pushing the yuan lower.

Economic Calendar

JPY - BOJ Core CPI y/y
CHF - Trade Balance
GBP - Public Sector Net Borrowing
EUR - Current Account
All - BRICS Summit
GBP - CBI Industrial Order Expectations
USD - Existing Home Sales
USD - Richmond Manufacturing Index
AUD - CB Leading Index m/m
USD - FOMC Member Goolsbee Speaks
USD - FOMC Member Bowman Speaks
NZD - Retail Sales q/q
NZD - Core Retail Sales q/q
AUD - Flash Manufacturing PMI
AUD - Flash Services PMI

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.85436 0.85346
gbp/usd 1.27941 1.27554
gbp/aud 1.99243 1.98502
gbp/nzd 2.15394 2.14516
usd/jpy 146.398 145.828
eur/usd 1.09221 1.08933
gbp/jpy 186.761 186.329
eur/cnh 7.96729 7.92824
usd/cnh 7.29731 7.26493
Equities and Commodities
Nasdaq 100 14948.9
DOW 34465.4
S&P 500 4403.59
WTI 80.01
GOLD 1897.69

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.

About Simon Walker


Simon Walker is head of the GPS Capital Markets trade desk in our London office where he is responsible for covering market risk in European hours. He has over 25 years’ experience in foreign exchange, working in both sales and trading.