[MARKET ANALYSIS] G10 FX mixed, energy exporters outperform, AUD outperforms after employment data, EUR looks ahead to ECB

G10s are mixed after initial losses for the Greenback were reversed as energy prices continue to determine bias. Action which has benefitted energy exporters CAD and NOK, the sole currencies firmer against the Buck. USD erased earlier modest losses as energy lifted to session highs with the Brent Sept’26 contract approaching levels not seen since May. Geopolitics remains constructive for the Buck, and there are no signs of immediate de-escalation - focus on Houthi attacks on Saudi Arabian vessels alongside flows through Bab al-Mandeb. Elsewhere, US earnings after the NY close were received poorly, with Google and Tesla slipping between 3-5% premarket, hitting indices and potentially increasing appetite for the Buck’s haven status. DXY rose from beneath the 21DMA @101, to mark a high at recent resistance near 101.20/1. EUR is lacklustre against the Buck ahead of the ECB meeting, where just 4bps of tightening is implied by markets. The Governing Council is likely to convey a hawkish message after the recent energy pressures. Should the bank stand pat on rates as analysts/markets expect, focus will be on guidance which could spur a move above two fully priced 25bp hikes by year-end. EUR/USD is well off highs made early in the domestic session, though found support towards 1.14. ING says this morning its near-term bias is tilted to the downside, noting if Gulf newsflow lacks signs of de-escalation, it looks for the pair to slip towards 1.1380 in the coming days. AUD is resilient against the Buck after strong jobs numbers overnight. The data saw headline Employment Change smash estimates at 76.3k (exp. 15k), and the Unemployment Rate remained at 4.4% despite higher Participation. It appears NZD is used as a funder to express AUD hawkishness given USD swings on geopolitics, with AUD/NZD +0.4%, while AUD/USD is flat. TRY looks to the CBRT meeting, where analysts have shifted calls for easing in exchange for a hold amid the recent energy pressures. Turkish inflation eased to 32.1% Y/Y in June from 32.6% in May, as energy prices fell following the US-Iran MoU, which has since broken down. Despite the softer print, most analysts still forecast year-end inflation above the CBRT’s 26% target (incl. GS, MUFG at 30%), suggesting rates will remain higher for longer, particularly after the recent resurgence in Gulf tensions. Banks mostly expect the bank to stand pat on its key rate; HSBC said it could instead adjust its funding policy, lowering the average funding cost for commercial banks without formally changing the policy rate; JPMorgan expects the CBRT to resume one-week repo auctions, while Garanti BBVA, which recently shifted its call, expects a hold, but does not rule out easing. USD/TRY is lacklustre ahead of the decision.