Market Roundup
- Sterling jumps to 2015 high on better than expected industrial data.
- GBP/USD rose to 1.5693 from 1.5558, above 200 DMA at 1.5624.
- Broadly weaker dollar, EUR/USD inched higher to 1.1279 from 1.1134.
- Dollar index down 0.9% to 94.244 from 95.160.
- AUD, NZD up vs USD at 0.7988, 0.7400 respectively.
- Moody’s says Australia budget underpins AAA rating, stable outlook.
- S&P- Australia’s rating not immediately affected by budget.
- UK April BRC retail sales -2.4% y/y vs previous 3.2%.
- UK March Industrial Output 0.5% m/m, 0.7% y/y vs previous 0.1%/0.1%. 0.0%/0.2% expected.
- UK March Manufacturing output 0.4% m/m, 1.1% y/y vs previous 0.5%/1.2% revised. 0.3%/1.0% expected.
- Greece tapped IMF reserves to make dept repayment – Govt Officials.
- Riksbank Jansson- Want to be clear may do more, might have to act fast.
- Jansson- Can’t tolerate any more inflation surprises.
- Fed Dudley- Don’t know when Fed will hike, applauds 2015 hike consensus.
Economic Data Ahead
- (0745 ET/ 1145 GMT) RetailEconomist.com/GS Chain Store Sales Index (May 9 wk) previous +3.7% y/y
- (0830 ET/1230 GMT) Redbook Same Store Sales Index (May 9 wk) previous +1.6% y/y
- (0900 ET/1300 GMT) NFIB Small Business Optimism Index (Apr) previous 95.2
- (1000 ET/1400 GMT) Job Openings and Labor Turnover Survey (Mar) previous job openings level 5.133 mln
- (1400 ET/1800 GMT) Federal Budget (Apr) market $147 bln, CBO $155 bln, previous $107 bln
Key Events Ahead
- (0900 EDT/1300 GMT) Former Fed Chairman Bernanke speaks at global private equity conference
- (0945 EDT/1345 GMT) Fed Trade Operation 15-year Fannie Mae/Freddie Mac (max $675 mln)
- (1100 EDT/1500 GMT) Household Debt and Credit Report (Q1)
- (1145 EDT/1545 GMT) Fed Trade Operation 30-year Fannie Mae/Freddie Mac (max $1.950 bln)
- (1245 EDT/1645 GMT) FRB San Francisco’s Williams (voter, dovish) on the economy at NYABE event
FX Recap
EUR/USD broke the resistance at 1.1220 levels and trading at 1.1270 levels after making intraday low at 1.1134. It is largely driven by skyrocketing German bund yields and a plummeting US dollar across the board amid a data-dry EUR calendar. Meanwhile, traders now focus on tomorrow’s German prelim GDP, CPI figures and EMU GDP data for further impact on the main currency pair. Immediate resistance is seen at 1.1300 levels, above which gains could be extended to 1.1346 (Feb 10 High) levels. On the down side, support is seen at 1.1134 (Today’s Low) below which it could extend losses to 1.1070 (April 30 Low) levels. Option expiries are at 1.1000 (776M), 1.1100 (584M), 1.1250 (273M).USD/JPY turns downside and currently trading below 120.00 levels and made high of 120.27 levels. Today is data free session for JPY. On the top side, the next resistance is located at 120.30 (May 1 High) levels and above which it could extend gains 120.54 (May 5 High) levels. Immediate support might be located at 120, below that at 119.43 (May 11 Low) levels. Option expiries are at 120.00 (1.3BLN) – note a further 2.5bln 120.00 Thursday.GBP/USD hit 2015 high of 1.5628 and made a new high at 1.5710 levels, largely on the back of remarkable manufacturing and industrial production data from the UK. While, broad USD weakness also supports the cable. Market will now be looking toward the Bank of England (BoE) Quarterly Inflation Report to be published tomorrow and additional comments by BoE Governor Mark Carney. The pair has an immediate resistance at 1.5700 above which gains could be extended to 1.5757 (Dec 17 High) levels. On the other side, support is seen at 1.5600 below which it could extend losses to 1.5558 (Today’s Low) levels. Option expiries are at 1.5500 (658M).USD/CHF dived more than 100 pips in the European session, falling back on the 0.92 obstacle, largely on the back of soaring EUR/USD which strengthened the Swiss franc. It touched the low at 0.9210 levels and currently trading at 0.9228 levels. It has made high of 0.9357 levels. Near term support is seen at 0.9195 levels and resistance is seen at 0.9367, 0.9412 levels.AUD/USD is trading at 0.7988 and made intraday high at 0.7990 levels after Australian budget details. The Australian dollar reversed previous losses and advanced against the US dollar in the mid-Asian session, following upbeat Australian home loans data while Fitch ratings confirmed that Australia’s AAA rating is not at risk also boosted the Aussie. Initial support is seen at 0.7859 and resistance at 0.8030 levels.
The material has been provided by InstaForex Company – www.instaforex.com