FX MARKET REPORT 07.04.2021

FX MARKET REPORT 07.04.2021

FX MARKET REPORT 07.04.2021

Daily Commentary
FX MARKET REPORT 07.04.2021
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FX MARKET REPORT 07.04.2021

The sharp sell-off in GBP to an overnight low of 1.3802 came as a surprise. While the rapid drop appears to be overdone, there is room for GBP to dip below 1.3800. For today, the next support at 1.3750 is unlikely to come under threat (1.3770 is already quite a strong level). Resistance is at 1.3865 followed by 1.3890. GBP/EUR tested the downside of 1.16 early Wednesday, now trading around 1.1620. Economists at Credit Suisse expect the EUR/USD pair to remain in a mild downtrend while there is an asymmetry to further rate differential widening. Their expected Q2 range is 1.14-1.21 and they like to sell rallies towards 1.20. EUR/USD rallying to a two-week high of 1.1878, and the benchmark 10-year U.S. Treasury yield dropping sharply to 1.65%. Yet many investors still question whether the Fed can stick to its dovish stance, particularly given the recent employment data. Friday’s payrolls report was much stronger than expected while Tuesday’s data showed the job market is creating more opportunities at a faster clip than many economists and employers forecast. USD/INR soared 0.8% to 74.065, with the Indian rupee falling to the lowest level since November low after the country’s central bank kept its benchmark repurchase rate at a record low of 4% but cut its cash reverse ratio and also signalled readiness to act to support growth. The dollar index was up 0.1% at 92.390, just above a two-week low of 92.246, slipping further from a five-month high of 93.439 set at the end of last month. USD/JPY rose 0.1% at 109.78, while the risk-sensitive AUD/USD was down 0.2% at 0.7649.

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The sharp sell-off in GBP to an overnight low of 1.3802 came as a surprise. While the rapid drop appears to be overdone, there is room for GBP to dip below 1.3800. For today, the next support at 1.3750 is unlikely to come under threat (1.3770 is already quite a strong level). Resistance is at…

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