FX Daily: Focus on G7 summit headlines

From think.ing.com

Periods of data silence often serve as a useful gauge of the market’s underlying bias in FX. So far this week, the tendency to add to USD short positions has been clear, even though the greenback remains notably undervalued against most G10 currencies when judged by short-term drivers such as rates and equity differentials. Expect an intensification of headlines from the G7 meeting running in Canada until tomorrow. As discussed in this note, there is a low probability-high impact of any suggestions that the G7’s longstanding commitment to allow free floating of exchange rates might be revised to allow dollar ... (full story)