Market Roundup
- World Bank cuts East Asia, China growth forecasts, warns of risk to outlook, East Asia +6.7% in ’15 vs previous +6.9%, China +7.1% vs +7.2%.
- BoJ Gov Kuroda: Japan recovering moderately, inflation currently around zero excluding effects of previous sales tax hike, financial system stable, will maintain QQE for as long as necessary to hit CPI target.
- BoJ March Policy Board meeting minutes: Economy to continue to recover, CPI to pick up, food/energy prices and wages drags, concerned over reversals of global fund flows once Fed begins to hike, some concerns over JGB market functioning, liquidity not a problem, concerns too on Greek situation.
- Japan Feb core machinery orders -0.4% m/m, +5.9% y/y, -2.8% and +3.7% consensus.
- Japan March domestic corp goods prices +0.3% m/m, +0.7% y/y, -0.1% and +0.4% consensus.
- Japan March money supply M2 +3.6% y/y, M3 +3.0%, broadest liquidity +3.3%.
- China March trade surplus $3.08 bln, exports -15% y/y, imports -12.7%, $45.35 bln, +12.0% and -11.7% consensus, exports impacted by Lunar New Year holidays, imports on downward economic pressure.
- New Zealand March electronic card retail sales +0.8% m/m, +3.7% y/y, Feb +1.1%, +4.0%.
Economic Data Ahead
- (0245 EDT/0645 GMT) France Feb current account balance; previous E300 mln deficit.
- (0400 EDT/0800GMT) Italy Feb industrial output, +0.5% m/m, -1.3% y/y consensus; previous -0.7%, -2.2%.
Key Events Ahead
- N/A US CommSec Pritzker, EnSec Monitz visit China.
- N/A Germany E2 bln 6-mo Bubill, France BTF, Norway treasury bill auctions.
- (0500 EDT/0900 GMT)Italy E3-3.5/2-2.5/1-1.5 bln 0.25/1.35/3.5% 2018/22/30 BTP auctions.
FX Recap
USD/JPY wiped out losses from previous session and hit fresh session highs in the mid-Asian session as US dollar continues to strengthen. It currently trades at 120.45 levels, having posted day’s high at 120.469 levels and low at 120.08 levels. The pair has resistance at 120.63 (April 10 High) levels and above which gains could be extended to 121 levels. On the flipside, support is likely to be found at 120.10 (Today’s Low) and then at 199.89 (10-DMA) levels.AUD/USD plunged into the red in Asia after the release of disappointing China Trade Balance figures. It currently trades at 0.7583 levels, breaking below the key support at 0.76 levels. Further downward move will see the pair testing 0.7559 (11 Mar low) and at 0.7532 (2 April low). On the other hand, resistance is located at 0.7640 levels and a break above could extend its gains to 0.7690/0.77 levels.NZD/USD also dived further south on downbeat Chinese data and mirroring the weakness seen in the Aussie. It trades around 0.7450 levels at present, with a high of 0.7536 levels and low of 0.7444 levels. On the downside, support might be found at 0.7520 and any break below will drag the pair further down till 0.7480 levels. On the upside, only a convincing break above 0.7610 levels would confirm bearish invalidation. GBP/USD continued moving downwards on Monday and currently trades at 1.4605 levels. Overall bias stays with the bears and the pair is expected to get support at 1.4590 levels, below which losses could be extended to 1.4550 levels. On the flipside, resistance is located at 1.4725 levels and a break above could push the pair to 1.4755 levels.EUR/USD remained largely unchanged in Asia and currently trades at 1.0588 levels. On the topside, major resistance is seen at 1.0640 levels and a break above would extend its gains to 38.2% Fib retracement at 1.0868 levels. Alternatively, a daily close below the 1.0456-1.0513 region (March 16 low, 50% Fibonacci expansion) would make the way for 61.8% level at 1.0386.
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