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US Treasury yields advanced on Friday during the North American session after reversing their course following the release of US Retail Sales data, which disappointed investors. Meanwhile, the lack of news from the Middle East kept Oill prices higher, amid fears of a resumption of hostilities.US yields climb as Oil stays bid, while weak sales pressure DollarThe US 10-year Treasury yield edged up by over 4 basis points to 4.692% amid a rise in Oil prices. West Texas Intermediate (WTI), the US crude benchmark, is up 1.50% at $82.39.US Retail Sales disappointed investors, contracting -0.6% MoM, below forecasts of 0.1%…

USD/MXN refreshed 24-month lows below 17.00 on Friday, but it has recovered some ground, with buyers stepping in and reclaiming the 17.00 level. Data from the United States (US) weighed on the Greenback, as consumer sentiment and Retail Sales deteriorated. The pair trades at 17.02, after bouncing off daily lows of 16.97.USD/MXN holds near two-year lows as traders price out Fed hikesUS data proved benign on the inflation front, with consumer and producer prices edging lower. The Nonfarm Payrolls reading on August 7 and jobless claims on Thursday paint a picture of ‘some’ softening, but give Federal Reserve officials no…

Societe Generale analysts highlight CNY’s firm trend, with the currency advancing to 6.7424, its strongest level since February 2023, on Dollar weakness and lower US yields. The PBoC reiterates an accommodative stance and targeted support while avoiding explicit rate or RRR cut signals, as 10-year CGB yields fall below 1.70%.Policy support underpins currency strength”CNY maintains steady appreciation path: The CNY advanced to 6.7424 today, its strongest level since February 2023, supported by broad-based dollar weakness and lower US yields.””In its latest quarterly monetary policy implementation report, the PBoC reiterated its commitment to maintaining an appropriately accommodative policy stance and deploying…

The US Dollar Index (DXY) extended its slide on Friday, holding below 100.00 at fresh lows after a fourth straight soft US data print. The preliminary Michigan Consumer Sentiment survey fell to 51 in August from 55.2, well short of forecasts, capping a week that also brought cooler inflation and a weak Retail Sales report. As a result, bets on a September Federal Reserve (Fed) rate hike have faded further. The coming week hands the Dollar no top-tier data of its own. Instead, Wednesday’s Federal Open Market Committee (FOMC) Minutes from the July meeting take center stage, offering the detail…

Commerzbank notes that the Kospi has rebounded 29.5% from its 30 July low, supported by strong tech earnings and improved sentiment toward semiconductor and memory chipmakers. They note USD/KRW has retreated nearly 8.9% from its July high as exporters’ repatriation and foreign portfolio inflows bolster the Korean Won. Despite a modest 0.3% rise to 1,421 on a stronger Dollar, KRW is the second-strongest Asian currency this year, up 1.5% versus USD and outperforming the regional ex-Japan average of -2.1%. Further volatility moderation in equities may offer near-term KRW support.USD/KRW retreats from July peak”The South Korean equity benchmark Kospi rose 3.6%…

The EUR/USD pair registers gains of over 0.32% on Friday as traders face key resistance at the 100-day Simple Moving Average (SMA) at 1.1567, as bulls eye the 1.1600 psychological figure. At the time of writing, the pair trades at 1.1564 after bouncing off daily lows of 1.1526.EUR/USD Price Forecast: Technical OutlookThe EUR/USD market structure suggests that the downtrend remains intact. The successive lower highs and lower lows have been respected, but since July 30, when the pair reclaimed the 1.1500 area, the risk of a bullish reversal has increased.Although the pair topped around 1.1550-60, the Relative Strength Index (RSI)…

MUFG’s Asia FX Weekly highlights that China’s July activity indicators, following weak Q2 GDP, will be central for the Chinese Yuan and regional FX. The authors stress ongoing weakness in fixed asset investment and property-sector challenges, and question whether domestic demand is stabilizing and whether PBOC will tolerate continued CNY strength. They also note PBOC has been guiding USD/CNY lower via its daily fixing.China data and fixing steer CNY”In China, attention will centre on July activity indicators, following a weak Q2 GDP print.””Fixed asset investment is likely to remain weak, underscoring ongoing challenges in the property sector.””The key question for…

USD/JPY is holding near 159.40 at the time of writing, with little change on the day. A weak United States (US) Consumer Sentiment reading nudged the Dollar lower, but the pair has stayed close to where it started.The University of Michigan’s preliminary Consumer Sentiment Index dropped to 51 in August from 55.2, well below the 54.5 that markets expected. The Expectations component fell to 50.6. It is the latest soft US number in a week that also brought cooler inflation and a weak Retail Sales report.Taken together, that run of data has taken some steam out of the US Dollar…

NZD/USD gains 0.75% on Friday and trades around 0.5895 at the time of writing, with its rally losing some momentum as it approaches the psychological 0.5900 level. The pair benefits mainly from weakness in the US Dollar (USD) following disappointing US economic data, while expectations surrounding the Reserve Bank of New Zealand (RBNZ) monetary policy continue to support the New Zealand Dollar (NZD).US Retail Sales contracted by 0.6% MoM in July, reversing a 0.2% increase in June and missing market expectations for a 0.1% rise. On an annual basis, sales increased by 5%. Weak consumer spending reinforces concerns about the…

TD Securities’ Oscar Munoz argues that Chair Kevin Warsh’s communication strategy has undermined market confidence in the Federal Reserve’s inflation-fighting resolve. The report expects Warsh to reset his approach as early as the Jackson Hole Symposium, with greater clarity on the Fed’s reaction function and policy framework seen as necessary to restore credibility and centralize guidance.Warsh seeks to rebuild Fed credibility”Questions around Fed credibility arose after the most recent FOMC meeting, with Chair Warsh’s lack of clarity about how the Committee intended to lower inflation acting as a key catalyst. We expect a reset on strategy by the chairman as…