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GBP:  The data on government borrowing rarely upsets the pound unless wildly away from expectations.   Sterling still has some underlying support from the better tone to data on the economy.

CAD:  Headline inflation is seen moving higher, from 0.4% to 0.9%.   Currently, USDCAD is not far off the high for the year (1.0421, made late May).

EUR: Finance ministers are meeting. There could be some headlines on Greece as it appears a little more politically unstable which threatens its ability to push ahead on the reforms demanded from its international lenders.

Idea of the Day

Thursday was a small glimpse of the world to come when the US Fed starts taking its foot of the monetary accelerator. Emerging markets were hit hard and the Aussie behaved like a boxer that had just been dealt a knock-out blow, with no signs of getting back on his feet.   Meanwhile bond yields were higher across the board with Italian yields moving up 3 times faster than German ones. All this on the fact that the Fed told us what is abundantly clear, namely they cannot go on buying USD 85 bln of securities a month indefinitely.   Furthermore, they were very subtle in the way it was phrased.   We could be entering something of a stand-off between the Fed and the markets from here, because the worse thing they can do for their credibility is to blink and back-track on the tone of their statement and comments this week in response to the market reaction.

Latest FX News

JPY:   The yen seeing further modest selling pressure during the Asia session. Comments from Kuroda having a limited impact at the start of the European session, the BoJ governor making some positive noises on the economy.

GBP:   The retail sales data on Thursday (stronger than expected) gave sterling a small lift, but it was minimal compared to the post-Fed moves. The data is still shaping up well for a decent second quarter in the UK, which should ultimately prove modestly supportive for sterling in the bigger picture. The1.54 area should continue to provide a decent area of support.

AUD: The Aussie was hammered in the wake of the Fed decision and remained on the floor during Thursday, holding just above the 0.9150 area through the day.

EUR: Trading relatively after the Asia move lower on Thursday, despite the fact that peripheral markets were selling-off quite aggressively in the post-Fed move.     Politically, Greece is looking a little more wobbly at the moment.