European markets came under some pressure, as Geo-Political tensions rise, over the use of US long-range missiles in the Ukraine conflict. Russia has warned using US and European long-range missiles into Russia, is a red line, and has lowered their nuclear threshold for use. The escalation by the US will be met by the Russians, as missiles have already rumoured to have been used, inside of Russian borders. European markets contracted following the uncertainty. US markets shrugged off the threats and rallied on the NASDAQ and S&P. The EUR dipped 1.0530, but recovered to trade 1.05890, while the GBP traded above 1.2650 ahead of key inflation data tonight.
The softer reserve allowed commodity currencies further consolidation, with the NZD regaining 0.5900, while the AUD pushes above 0.6500. The RBA minutes reiterated a strong focus on fighting inflation and even may consider raising rates, if the stubbornly high inflation continues. Local markets will be watching Japanese trade data closely.
