Market Roundup
- ECB’s Nowotny: could consider extending maturity of Greek debt.
- BOE’s McCafferty: exchange rates having material impact on inflation outlook (MNI).
- BOE’s McCafferty: must be careful not to leave rate hike too late (MNI).
- IMF: Japan inflation to pick up to about 1.5% in Med-term, BOJ’s 2% target challenging.
- Italy cancels end of July zero-coupon offering due to reduced funding needs, large cash availability.
- Brazil’s BRL falls after government cuts budget surplus target.
- Fitch: Brazil’s fiscal deficit will remain elevated, debt burden to climb further in ’15 even if new target is met.
- SARB raises key interest rate 25bps to 6%.
- US Initial Jobless Claims w/e 255k, f/c 280k, 281k-previous.
- US Continued Jobless Claims* w/e 2.207m, f/c 2.225m, 2.216m-previous.
- US Leading Index change MM* Jun 0.6%, f/c 0.2%, 0.8%-previous.
- CA Retail Sales Ex-Autos MM May 0.9%, f/c 0.8%, -0.5%-previous.
- BR Unemployment Rate* Jun 6.9%, f/c 6.9%, 6.7%-previous.
- MX 1st Half-Monthly Inflation YY Jul 2.76%, f/c 2.87%, 2.87%-previous.
- Reuters Poll US Fed seen raising rates in Sept, pace likely gradual.
Looking Ahead – Economic Data (GMT)
- 22:45 New Zealand Trade – Imports* Jun f/c 3.95b, 4.01b-previous
- 22:45 New Zealand Trade Balance* Jun f/c 100.0m, 350.0m-previous
- 22:45 New Zealand Trade Balance YY* Jun f/c -2.70b, -2.57b-previous
- 22:45 Japan Trade – Exports* Jun f/c 4.09b, 4.36b-previous
- 23:50 Japan Foreign Bond Investment w/e 163.1b-previous
- 23:50 Japan Foreign Invest JP Stock w/e -851.2b-previous
- 01:35 Japan Nikkei Manufacturing PMI Flash Jul 50.1-previous
- 01:45 China Caixin Manufacturing PMI Flash Jul f/c 49.7, 49.4-previous
Looking Ahead – Events, Other Releases (GMT)
- No Significant Events
Currency Summaries
EUR/USD
EUR/USD is supported around 1.0910 levels and currently trading at 1.0999 levels. It has made session high at 1.1017 and lows at 1.0947 levels. The pair immediately started to fall from, 1.1010 levels after US jobless claims fell to lowest level since 4-decades. Initial jobless claims dropped to 255k, a decrease of 26k from the previous reading. Analysts had predicted jobless claims to be around 271k. The pair rebounded after hitting session low at 1.0949 and bounced back to retake 1.10 levels on renewed Greece optimism, on Thursday Greek parliament approved a second set of reforms required to start negotiations with lenders in a bid to avert bankruptcy. The Euro remained top performer of the session as the other majors slipped against the US Dollar. To the upside, immediate resistance can be seen at 1.1015. To the downside, major support level is located at 1.0915.
GBP/USD
GBP/USD is supported around 1.5460 levels and currently trading at 1.5518 levels. It has made session high at 1.5575 and low at 1.5499 levels. Sterling slipped from 1.5601 levels, to hit 1-week lows against the green back at 1.5530 levels. The pair was hammered below after US jobless claims fell drastically low. The Sterling gave back all the gains it made from the past two days against the US dollar. Sterling’s fall was triggered by, Bank of England (BOE) minutes on Wednesday and UK retail sales released in Thursdays UK session, which printed negative readings at 0.2 % against forecast of 0.3% . To the upside, immediate resistance can be seen at 1.5550. To the downside, major support level is located at 1.5460. Overall trend of this pair is bearish in the long term.
USD/CHF
USD/CHF is supported around 0.9523 levels and currently trading at 0.9574 levels. It has made session high at 0.9599 and low at 0.9559 levels. The Pair was hammered by the bears in the earlier UK session, The pair slipped 75 pips from daily high at 0.9600 to hit 1-week lows at 0.9524. The pair rebounded form 0.9524 levels and inched higher by gaining some losses for a brief period of time , after the US initial jobless claims report, the pair surged and reclaimed the 0.9600 level . Ahead in the day Manufacturing PMI and Existing New Homes sales are the important data set to be released from US market. To the upside, immediate resistance can be seen at 0.9610. To the downside, major support level is located at 0.9524. Overall trend of this pair remains bullish in the long term.
USD/JPY
USD/JPY is supported around 123.50 levels and currently trading at 123.77 levels. It has made session high at 124.17 and low at 123.70 levels. The greenback pared losses briefly versus the yen after the government said first-time filings for unemployment benefits fell to 255,000 last week, the lowest since November 1973. This supported the view of an improving jobs market that may allow the Fed to raise interest rates as early as September. The dollar resumed its earlier weakness as U.S. Treasury yields fell to two-week lows on growing losses on Wall Street and deflation worries from falling commodity prices. Dollar was down 0.1 percent at 123.79 against the Yen. The Yen was briefly on the defensive after the International Monetary Fund warned Japan to avoid over-reliance on a weak currency to reflate its economy. To the upside, immediate resistance can be seen at 124.15. To the downside, major support level is located at 123.50. Overall trend of this pair is bullish in the long term.
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