Market Roundup

  • RBA: At its meeting today, the board decided to leave the cash rate unchanged at 2.25 percent.
  • Rba says lower A$ needed for economy.
  • Sterling briefly touches day’s high against euro at 72.89 pence per euro.
  • Euro Zone Feb Producer Prices -2.8 pct y/y.
  • Euro Zone Sentix Index rises to 20.0 in April from 18.6 In March.
  • Markit Eurozone March Final Composite PMI 54.0 (54.1 Flash, Feb Final 53.3); 11-month high.
  • German March Final Services PMI 55.4 (Flash 55.3, Feb Final 54.7).
  • German March Final Composite PMI 55.4 (Flash 55.3, Feb Final 53.8).
  • French March Final Services PMI falls to 52.4 (Flash 52.8, Feb Final 53.4).
  • French March Final Composite PMI falls to 51.5 (Flash 51.7, Feb Final 52.2).
  • Italy March Services PMI rises To 51.6 in March (Feb 50.0, Forecast 51.4).
  • Italy March Services PMI New Business rises to 53.1 in March, highest in eight months.
  • Italy March Composite PMI for Services and Manufacturing rises to 52.4 from 51.0 in Feb, highest in eight months.
  • UK Composite PMI rises to 58.7 from 57.0, highest since Aug 2014.
  • UK Services PMI rises to 58.9 in March Vs 56.7 in Feb, highest since Aug 2014.
  • Swiss National Bank Forex Reserves At 522.323 bln sfr end March vs revised 509.245 bln sfr at end February.

Economic Data Ahead

  • (0845 EDT/1245 GMT)USWeekly Chain Stores Sales Idx Apr4 week previous +2.9% y/y
  • (0955 EDT/1355 GMT) USRedbook Same Store Sales Index Apr4 week previous +3.0% y/y
  • (1100 EDT/1500GMT) US Job Opens/Labor Turnover Feb previous job openings level 4.998 mln
  • (1600 EDT/2000GMT) US Consumer Credit Feb consensus +$13.00 bln, previous +$11.56 bln

Key Events Ahead

  • (0950 EDT/1350 GMT) FRB Minneap Kocherlakota at Chamber of Com; Bismarck, ND
  • (1245 EDT/1645GMT) FedTrade 30-year Ginnie Mae max $1.075 bln

FX Recap

EUR/USD plunged in the European session and moved closer to the 1.08 mark, mainly due to strengthening of the US dollar across board. It currently trades at 1.0853 levels, having posted day’s high at 1.0953 levels and low at 1.0833 levels. The pair also remains under pressure as markets focus on the latest developments coming from Greece ahead of its April 09 repayment deadline to IMF. On the topside, immediate resistance is seen at 1.0955 levels, above which it could extend its gains to 1.1000 levels. On the downside, support is located at 1.0862 and a break below will drag the pair to 1.0800 levels. Option expiries at 1.0800 (2.1BLN), 1.0900 (2.1BLN), 1.1000 (3BLN).GBP/USD remained largely unchanged on Tuesday as sterling fails to obtain strong support from UK services PMI. It trades flat at 1.4879 levels and faces strong resistance at 1.49 levels. A break above this level would push the pair to 1.4922 levels. On the downside, it is likely to find support at 1.4830 levels and a break below would extend its losses to 1.4800 levels. Option expiries at 1.4900 (1BLN). EUR/GBP fell to a new intra-day low of 0.7289 on upbeat UK service PMI data.USD/CAD has taken support near 1.2425 and slightly recovered from that level. Overall trend is bullish as long as support 1.2400 holds. On the downside any break below 1.2400 will take the pair further down till 1.2350. The pair’s minor resistance is around 1.2515 and any break above would extend gains till 1.2579 (200 day 4HMA)/1.2650 in short term.USD/JPY uptrend gained further momentum and the pair hit day’s high at 120.05 levels before easing to 119.86 levels. The pair seems to have recovered from its post-NFP low of 118.70 levels. It is expected to move in sync with the overall market sentiment due to lack of major economic releases from Japan. It faces major resistance at 120.46 (Feb. 11 high), above which it could be pushed to 120.81 (Dec. 23 high). On the other hand, a break below 119.76 (50-DMA), could see the pair testing 119.20 (100-DMA). Option expiries at 118.35 (430M), 119.00 (927M), 119.95-120.05 (1BLN).USD/CHF moved higher on renewed dollar strength and trades at 0.9621 levels. It hit day’s high at 0.9643 levels. However, the pair seems to be capped by upbeat forex reserves data. Switzerland’s foreign currency reserves rose 522.323 bln sfr end March vs revised 509.245 bln sfr at end. On the topside, a break above 0.9750 levels would make the way for 0.9677 levels. On the flipside, support is seen at 0.9600 levels and then at 0.9557 levels.

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