Market Roundup
- US GDP Q1 0.2%, (consensus 1%, previous 2.2%)
- US Core PCE Prices Q1 0.9%, (consensus 1%, previous 1.1%)
- US Pending Homes Index Mar 108.6, (previous 107.4)
- Brazil IGP-M Inflation Index Apr 1.17%, (consensus 1.09%, previous 0.98%), inflation remains well above target
- Chile March copper output down 2.3 pct, floods in Northern Chile blamed
- Fed keeps rates on hold, will hike as employment improves and is reasonably confident of inflation moving to 2% target
- USD rallies a touch after FOMC, after broad move lower post-US GDP
- UST yields follow broader market rise despite US GDP miss, global equities fall as well
- European top court to judge legality of ECB’s OMT on June 16
- Germany’ Jaeger expects speedier Greek debt talks with new team in Athens
- ECB’s Hansson Debate on Greek bank collateral not yet on ECB agenda
- Greek Fin Min Varoufakis says still in charge of euro zone debt talks (Die Zeit)
- Greece has days, not weeks, to clinch deal on reforms with euro zone, IMF – euro zone officials
- Greece must quickly start negotiating 3rd bailout, won’t survive without one – euro zone officials
Economic Data Ahead
- (1700 ET/ 2100 GMT) NewZealand Cen Bank Interest Rate N/A (previous 3.5%)
- (1845 ET/ 2245 GMT) NewZealand Building Consents Mar (previous -6.3%)
- (1950 ET/ 2350 GMT) Japan Industrial output prelim mm Mar (consensus -2.3%, previous -3.1%)
- (1950 ET/ 2350 GMT) Japan IP Forecast 1 Mth Ahead Mar (previous -2%)
- (1950 ET/ 2350 GMT) Japan IP Forecast 2 Mth Ahead Mar (previous 3.6%)
- (2130 ET/ 0130 GMT) Australia Private Sector Credit Mar (consensus 0.5%, previous 0.5%)
- (2130 ET/ 0130 GMT) Australia Housing Credit Mar (previous 0.5%)
- (2130 ET/ 0130 GMT) Australia Export Prices Q1 (previous 0%)
- (2130 ET/ 0130 GMT) Australia Import Prices Q1 (previous 0.9%)
- (0100 ET/ 0500 GMT) Japan Construction Orders YY Mar (previous 1%)
- (0100 ET/ 0500 GMT) Japan Housing Starts YY Mar (consensus -1.9%, previous -3.1%)
Key Events Ahead
- (2300 ET/ 0300 GMT) Japan BOJ holds monetary policy meeting, issues semi-annual report on the economy and prices, Kuroda presser
FX Recap
USD/JPY: US dollar turned sharply lower following US GDP data. It recovered modestly across the board after the FOMC statement but still remains sharply lower for the day. USD/JPY was trading at daily lows around 118.60/65 but recovered after FOMC meeting and rose to 119.05. The pair then dropped toward 118.70. Currently the pair is trading around the level it closed yesterday, after being able to hold above April lows that lie at 118.50. Option expiries Thursday 30th April: 118.50 (1.3BLN), 119.00 (546M) 119.15 (326M)119.55 (617M), 120.00 (2.8BLN)
EUR/USD deflates from session peaks in the 1.1180 area following the unchanged stance from the FOMC in today’s meeting. The single currency is surrendering part of today’s strong gains vs. the greenback and is now trading at the low-1.1100s. EUR/USD is up 1.10% on the day with the next resistance at 1.1189 (high Apr 29) ahead of 1.1200 (psychological level) and finally 1.1218 (high Mar 3). On the downside supports lie at 1.0959 (low Apr 29), 1.0928 (55-d MA) and then 1.0860 (low Apr 28).
USD/CHF had earlier bottomed at 0.9340, but climbed back above 0.9400 boosted after the FOMC statement. Greenback gained momentum across the board and trimmed losses which followed poor US GDP data. USD/CHF is recovering ground and remains above 0.9400 but is still down over hundred pips, headed toward the lowest daily close since Jan 20. Option expiries Thursday 30th April: 0.9550 (242M)
USD/CAD is now regaining the vicinity of 1.2050 after the FOMC decision after bottoming out earlier in the 1.1940 area. There was a resurgence of buying interest around the US dollar after the FOMC meeting which propped USD/CAD from multi-week troughs below 1.1950. Currently the pair is trading at 1.2022 down 0.08% on the day. Next support is at 1.1945 (low Apr 29) followed by 1.1940 (low Jan 20) and then 1.1900 (psychological level). Resistances are located at 1.2116 (high Apr 28), 1.2205 (high Apr 27) and finally 1.2269 (high Apr 23). Option expiries Thursday 30th April: 1.2150 (420M)
NZD/USD: Dollar crumbled on GDP miss but trimmed losses after FOMC statement. The kiwi remained weak across the board with investors waiting for the RBNZ announcement. NZD/USD was trading above 0.7700 but pulled back to daily lows at 0.7685 after the FOMC meeting. The pair is currently hovering slightly below 0.7700, headed toward the first daily loss since last Thursday. Option expiries Thursday 30th April: 0.7500 (526M), 0.7650 (721M), 0.7720-25 (500M)
The material has been provided by InstaForex Company – www.instaforex.com