CNY depreciation risk adds to bullish dollar tone - ING

ING strategists on latest FX trends. Analysts said: "Should the PBoC start to allow a higher series of USD/CNY fixings - acceding to market pressure - it could prove a boost to the dollar around the world... It is very hard to fight the dollar bull trend right now and DXY may find support at 106.00 ahead of a trend towards 107."

"Policy divergence remains the dominant story here [EUR/USD]. As discussed yesterday, the greater headwinds for global equities are allowing EUR/USD to play catch-up with yield differentials - which are at their most favourable for the dollar since late 2022. There is not too much on the eurozone calendar today - just a few ECB speakers and the ZEW investor expectations survey. Technically, it looks as though EUR/USD will undergo a series of shallow corrections and drop to new lows - suggesting a 1.0500 target for the next week or so is a good one."

"Sterling is jumping around on this morning's employment and wage release data. While some may be focusing on the decline in employment, we think the 12% annualised month-on-month reading in private sector pay is far more consequential for the Bank of England. This is not the kind of benign wage data the BoE needs to see before it is prepared to cut rates."

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