Summer Lull Or Summer Vol

This report analyzes FX market sentiment amid US-Iran geopolitical tensions and provides updates on CAD, JPY, and NOK. Markets remain resilient with low volatility, favoring G10 carry trades in the absence of significant escalations.

Key Takeaways

• 1.Growing US-Iran tensions have had limited impact on FX markets, with volatility remaining near multi-year lows.
• 2.The Canadian dollar (CAD) shows signs of strength, potentially supported by positive Canadian labor data.
• 3.The Japanese Yen remains under pressure as rhetoric from the Finance Minister regarding BoJ independence and pension fund allocations has yet to translate into market-moving action.

Table of Contents

• Asia overnight
• Summer lull or summer vol?
• CAD: working harder
• JPY: is talk still cheap?
• NOK: reflated, in part
• Open trade recommendations
• Key events

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