- Japan May corporate service prices +0.1% m/m, +0.6% y/y, same ex-sales tax hike.
- BOJ May 21-22 Policy Board minutes – Most saw underlying inflation trend continuing higher, target to be hit around H1 FY’16, impact from decline in real interest rates diminishing, output weighed down by adjustments for now but economy to continue to rise, weak Tokyo CPI a concern, Kiuchi negative views on CPI, QQE still.
- BOJ loan support program to financial institutions to hit Y30 trln.
- BOE MPC Weale – Prepare for an UK rate rise by August.
- France Pres Hollande feared Grexit back in ’12.
- Italy takes steps to help banks of-load bad loans.
- Australia May job vacancies at 10-month low, 153.5k, -3.1% m/m, +0.2% y/y.
- Thomson Reuters/INSEAD Q2 Asia business sentiment index 70, Q1 71, Thailand and India businesses most optimistic, China and Singapore least.
- (0130 ET/0530 GMT) France Q1 GDP – details, +0.6% q/q eyed; prelim +0.6%.
- (0200 ET/0600 GMT) Switzerland May UBS consumption indicator; last 1.25.
- (0400 ET/0800 GMT) Germany June IFO business climate index, 108.1 eyed; last 108.5.
- (0400 ET/0800 GMT) Germany June IFO current conditions index, 114.1 eyed; last 114.3.
- (0400 ET/0800 GMT) Germany June IFO expectations index, 102.5 eyed; last 103.0.
- (0400 ET/0800 GMT) Norway April labour force survey – unemployment, 4.2% eyed; last 4.1%.
- (0400 ET/0800 GMT) Italy May wage inflation; last +0.2% m/m, +1.2% y/y.
- (0500 ET/0900 GMT) Italy May trade balance – non-EU – flash; last bln surplus.
- (0830 ET/1230 GMT) US Q1 GDP final, -0.2% q/q eyed; last -0.7%.
- (0830 ET/1230 GMT) US Q1 PCE prices final, -2.0% eyed; prelim -2.0%.
- (0830 ET/1230 GMT) US Q1 core PCE prices final, +0.8% eyed; prelim +0.8%.
- (0830 ET/1230 GMT) US Q1 GDP deflator final, -0.1% eyed; prelim -0.1%.
- (0900 ET/1300 GMT) Belgium June leading indicator index, -5.1 eyed; last -4.9.
Key Events Ahead
- N/A BoE Finch speech at London Cloud World forum.
- N/A ECD Biz-Finance Outlook event in Paris, SecGen Gurria speech.
- N/A Norway NOK2 bln 4.5% 2019 bond, Sweden Treasury bill auctions.
- (0530 ET/0930 GMT) Buba Nagel speech in Frankfurt, ECB 98-day LTRO operation.
- (0800 ET/1200 GMT) Greek PM Tsiparas meetings with IMF, ECB, EU leaders in Brussels.
- (1000 ET/1400 GMT) ECB VP Constancio in Frankfurt panel discussion.
- (1100 ET/1500 GMT) BoS Gov Linde parliamentary testimony.
- (1300 ET/1700 GMT) Euro Zone Finance Ministers meeting in Brussels on Greece.
FX Recap
EUR/USD is supported below 1.1200 levels and currently trading at 1.1184 levels. It has made intraday high at 1.1187 and low at 1.1153 levels. Pair fell down to a fresh 2-week low of 1.1134, despite a Greek deal is under way and improved Euro Zone economic growth. In the US, economic data resulted mixed, as Durable Goods Orders for May resulted worse-than-expected, printing -1.8% against a 0.6% drop. Nevertheless, orders for business equipment rose; indicating demand for American-made manufactured goods is stabilizing. New Home sales data rose the highest level in seven years, while the Markit Manufacturing PMI registered 53.4, the lowest reading since October 2013, but still above the 50 threshold that indicates economic expansion. Initial support is seen around 1.1050 and resistance is seen around 1.1375 levels.USD/JPY is supported around 124.00 levels and posted a high of 123.93 levels. It has made intraday low at 123.74 and currently trading at 123.89 levels. The dollar-yen pair rose to a new four day high at 124.19 on Tuesday after US new home sales data jumped to fresh 7-yr highs while the FOMC voting member Jerome Powell’s speech also supported the rally in the USD. Today pair trades in a flat range, with Bank of Japan minutes helping little to lift the yen. While a retreat in the greenback on profit-taking keeps the pair largely subdued. The major remained calm by eventless BOJ minutes which echoed the same news that the QQE is having its intended effects and the BOJ will adjust policy if needed. Traders are keeping an eye on the third estimate of the first-quarter US GDP growth scheduled later today. Near term resistance is seen at 124.57 and support is seen at 122.10 levels.GBP/USD is supported above $1.5700 levels. It made an intraday high at 1.5744 and low at 1.5721 levels. Pair is currently trading at 1.5735 levels and looks to test 1.57 barriers as traders favour the reserve currency ahead of the Greek decision and positive US new home sales data. Today UK will release BBA mortgage approval data. Initial support is seen at 1.5624 and resistance is seen around 1.5835 levels.USD/CHF is supported above 0.9300 levels and trading at 0.9340 levels and made intraday low at 0.9325 and high at 0.9344 levels. Pair is trading higher after positive US new home sales data released yesterday. Market will eye on US final GDP data due for release later today. Today Switzerland will release UBS consumption indicator data. Near term support is seen at 0.9113 levels and resistance is seen at 0.9383 levels.AUD/USD is supported around 0.7700 levels and trading at 0.7715 levels. It has made intraday high at 0.7757 levels and low at 0.7711 levels. Gains in commodity prices overnight likely provided some support to the commodity-based currencies, with both Brent and WTI futures climbing more than 1% each. Metals and base commodity markets were also broadly higher. News that Greece was closer to reaching an agreement with its creditors also saw risk sentiment creep back into the markets overnight, which is usually a positive for the Australian currencies. There is little from data calendar today, market will eye on US GDP data for the further directions. Initial support is seen at 0.7568 and resistance at 0.7838 levels.
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