RBC Capital Markets

The ECB Governing Council will meet this weekend in person for the first time since the Covid-19 pandemic began to review ECB strategy, covering the inflation target and climate change in particular. Any decisions made however will only be unveiled at the annual ECB forum in September. Day ahead: The data in focus today are UK May retail sales, Germany May PPI, and euro area April current account balance. There is also BOJ Governor Kuroda’s post-meeting press conference. CAD: A daily close above the 1-year descending channel top at USD/CAD 1.2362 would confirm a bullish long-term trend reversal that would shift the focus up to 1.2406 and 1.2502 next. Support is located at 1.2296 and 1.2263.


The USD continues to bask in the FOMC correction, but overnight markets drifted as we approached the weekend. The Antipodeans remain under pressure, but EURUSD is trying to stabilize around the 1.19 handle. The USDCNH weekly close will be one to watch as a key resistance range could hold. With limited catalysts today, we don’t expect much movement in price action.

The BoJ overnight was in line with expectations while CitiFX Strategy takes a closer look as to why JPY remains weak. The characteristics of JPY as a safe haven currency are becoming less readily manifest, and USDJPY is increasingly becoming to follow the overall USD trend. UK retail sales and and PLN wage data are the only scheduled catalysts but rates remain the key story.