FX Update: Narrow ranges have been prevailing
FX Update: Narrow ranges have been prevailing so far today. USD-JPY has settled in the mid 112.0s after concomitantly rising with a recovery in global stock markets, leaving yesterday's one-month low at 111.88. The pair has been inversely correlating with stock market direction over the last week or so, reflecting the sharpened ebb and flow of risk appetite in markets of late, which in turns generates buying and selling of safe have assets and currencies, such as the yen. EUR-USD has steadied in the mid 1.17s after whipsawing yesterday as markets digested the shifting political landscape in Germany, where new elections are looking the most likely outcome following the collapse of negotiations to form a coalition government. The pound has consolidated gains seen yesterday, which were inspired reports that PM May will offer the EU a sweetened divorce settlement, feeding hopes that this might break the deadlock and pave the way for talks on a future trade deal and transition.