1 Jul 2013
Flash: H2 starts with attempt at risk-bounce - Societe Generale
Fxstreet.com (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that H2 has started with an attempt at a risk-bounce.
He notes that the second half of the year has started with soft data out of China (PMI at 50.1 vs. 50.8, HSBC PMI at 48.2 vs. 49.2) and good data out of Japan (Tankan large manufacturers’ outlook at +10, the best level since Q4 2007). He sees that Asian currencies, led by the Korean won, are trying to bounce after June’s softness, and the biggest loser is the yen, as risk ‘dip-buyers’ return. He writes, “Whether this attempt at a positive market mindset can last a very busy week of PMIs is doubtful. Final Eurozone PMI, UK PMI and US ISM are out later. On SG forecasts, softness in the UK (50.9 vs. 51.3) and strength in the US (51.5 vs. 49) suggest long Gilts vs Treasuries and short GBP/USD may be the way to start the week.”
He notes that the second half of the year has started with soft data out of China (PMI at 50.1 vs. 50.8, HSBC PMI at 48.2 vs. 49.2) and good data out of Japan (Tankan large manufacturers’ outlook at +10, the best level since Q4 2007). He sees that Asian currencies, led by the Korean won, are trying to bounce after June’s softness, and the biggest loser is the yen, as risk ‘dip-buyers’ return. He writes, “Whether this attempt at a positive market mindset can last a very busy week of PMIs is doubtful. Final Eurozone PMI, UK PMI and US ISM are out later. On SG forecasts, softness in the UK (50.9 vs. 51.3) and strength in the US (51.5 vs. 49) suggest long Gilts vs Treasuries and short GBP/USD may be the way to start the week.”