GBP, USD Find Broad Support; AUD Weaker; Metals And Oil Off

against most major rivals through the European session as EUR/USD slumped to US$ 1.3385, USD/JPY tested ¥97.67, AUD/USD fell to US$ 0.8999, and NZD/USD weakened to US$ 0.7890. The major focus today will be the release of the minutes from the 30-31 July FOMC meeting as traders await cues on a possible QE taper starting in September. Many expect the Fed to taper asset purchases by about US$ 10 billion per month. July existing home sales (prior: -1.2% m/m) are due today.

The British Pound climbed higher against most peers through the European session as GBP/USD tested US$ 1.5680, EUR/GBP came off to £0.8538, GBP/JPY reached ¥152.95, and GBP/AUD gained to A$ 1.7416. Sterling has retained a firm bid during recent periods of uncertainty. CBI’s August manufacturing report notched its strongest showing in two years at +0 today, exceeding expectations. July public sector net borrowing came in at -£1.6 billion and U.K. Q2 GDP numbers are expected on Friday.

The Euro was mixed against other currencies through the European session as EUR/CHF tested CHF 1.2322 and EUR/NZD reached NZ$ 1.6968. Major European PMI data are scheduled for release tomorrow followed by Friday’s German Q2 GDP numbers and Eurozone August consumer confidence. Germany today reported there is nothing new concerning financial aid to Greece with further updates expected in mid-2014 – long after Merkel’s upcoming election battle is over. Bundesbank boss Weidmann took on the ECB’s forward guidance today, saying he would favour a “timely publication” of ECB’s meeting minutes. Two days ago, Buba’s monthly report noted ECB’s forward guidance does not preclude a rate increase if inflation pressures emerge whereas ECB’s Draghi this month reported rates will remain at steady or lower levels for an extended period of time.

The Australian Dollar was pressured against most currencies through the European session as EUR/AUD climbed to A$ 1.4882 and AUD/JPY sank to ¥87.61. DEWR July skilled vacancies were up +0.7% m/m and the Westpac July leading index improved to +0.0% m/m. A$ received a little bump higher when the China July leading economic index improved to 267.3 from the prior reading of 263.6. The June leading index is expected tomorrow.

The New Zealand dollar was lower across the board through the European session as NZD/USD came off to US$ 0.7890, EUR/NZD gained to NZ$ 1.6968, and NZD/JPY fell to ¥76.86. RBNZ moved the markets this week when it indicated new lending limits will be imposed in NZ from October in an attempt to deflate any asset bubble in house prices.

Gold and Silver traded sideways through the European session with Gold reaching $1374.39 before coming off and Silver was capped around $23.16. Gold reached $1377.54 yesterday before ceding some intraday gains and Silver yesterday tested $23.31 early before ending the day lower. Both Gold and Silver are likely to take direction from the FOMC meeting minutes expected today. Less Fed liquidity in the financial markets may result in metals prices being pressured. Holdings in Gold ETPs increased 1.5 metric tons to about 1,949.2 tons yesterday.

Crude Oil consolidated some of yesterday’s gains through the European session as Brent futures traded as low as $108.90 and WTI futures backtracked to $104.31. Weekly EIA U.S. oil and distillate inventories data are due for release in the U.S. today. Oil is pressured by news that some Libyan oil exports may resume sooner than expected. Nearly half of Libya’s 1.2 million barrels per day output of crude oil export capacity is sidelined on account of civil unrest and strikes. In the U.S., the Seaway crude oil pipeline has shut and this has temporarily ended shipments from the U.S. Midwest to the Gulf Coast. This could see oil stocks in Cushing, Oklahoma increase, resulting in price pressures. Traders continue to monitor events in the Suez Canal and Sumed pipeline. Egypt’s military has guaranteed the safety of the canal and pipeline but any disruptions could have repercussions. Crude oil is also expected to take cues from the FOMC meeting minutes expected today.