- UK voters head to polling stations today (don’t forget your photo ID), and if polls are to be believed, we will wake up to a change in government, and Labour leader Kier Starmer as the new Prime Minister. The pound has held up quite well with only a shock in the results likely to lead to any significant volatility. Clearly the risk is to the downside with sterling, with markets and the UK’s population expecting a significant Labour majority.
- The US dollar lost ground against its G10 peers yesterday after disappointing data with the ISM Services PMI plunging in June to 48.8 from 53.8 previously. The print was the lowest in four years, with recent prints fluctuating across the 50 area which separates contraction from expansion in this index. EURUSD made a valiant attempt to breach the key 1.08 level and briefly traded as high as 1.0817 before running in to offers. The pair now sits close to the 1.08 area which has been a significant resistant level. French politics and recent weak German data are currently keeping a lid on EURUSD.
- USDJPY enjoyed a small breather yesterday post US ISM data, pushing the pair to a low of 160.75 before bouncing. The market remains nervous of intervention, however many feel that the 1986 high of 164.50 is the key resistance area and may be a level where the BoJ steps in.
- It’s the 4th of July, so wishing all our American readers a happy Independence Day, in what is likely to be a quiet session for markets.
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