FXStreet (Barcelona) - Lee Hardman, FX Analyst at the Bank of Tokyo Mitsubishi UFJ observes events from Ukraine and Middle East have not yet impacted on markets.

Key Quotes

"The foreign exchange market has remained very stable in the Asian trading session. The three-month implied volatility for USD/JPY has fallen to a new low according to Bloomberg since it began recording the data in December 1995."

"The combination of diminished downside risks to global growth and still loose monetary policy is helping to dampen financial market volatility. Downside risks to global growth from geopolitical tensions related to developments in the Ukraine and the Middle East have not yet materially impacted the global growth outlook."

"Higher energy prices would be one clear channel through which developments in the Ukraine and in the Middle East could dampen the outlook for global growth. However, the price of crude oil has also remained relatively stable over the last couple of years with Brent having traded for the most part between USD105/barrel and USD115/barrel."

"The price of crude oil has fallen back overnight following reports from Iraqiya TV that government forces have taken back the Al Waleed border crossing into Syria and the Traibil passageway near Jordan. US Secretary of State John Kerry also told reporters after talks with Iraqi Prime Minister Nouri al-Maliki that US support “will be intense, sustained, and if Iraq’s leaders take the necessary steps to bring the country together, it will be effective”. An agreement has been reached to form a new government in Iraq by the 1st July that includes all the country’s political and religious factions."