Market Roundup
- European May Day holidays leaves FX thin but steady.
- Dollar index off 94.399 2-mth low. April was worse month for index in 4 years.
- Irish Central Bank Gov: Ireland well on road to repair degree of fragility with high debt levels.
- EUR/JPY lifts to 135.09, highest since late February.
- EUR/USD extends to fresh highs, plays 1.1200/1.1285.
- GBPUSD hits day’s low of $1.5267 after UK data, from $1.5370 beforehand.
- GBP hits three-week low vs EURO of 73.40 pence from 73.15 pence before data.
- EUR/GBP potential deal, Munited for RMadrid’s Bale, £100m budget Telegraph.
- UK April Markit/CIPS Manufacturing PMI decrease to 51.9 (consensus 54.6) VS previous 54.4.
- UK March M4 money supply increase to +0.3 % VS previous -0.2 %.
- UK March mortgage approvals decrease to 61.341 K (consensus 62.400 K) VS previous 61.760 K.
- UK March mortgage lending increase to +1.829 BLN GBP (consensus 1.800 BLN GBP) VS previous 1.741 BLN GBP.
Economic Data Ahead
- (1045 EDT/1445 GMT) US Market Manufacturing PMI (April) previous 55.7
- (11 EDT/1500 GMT) ISM Manufacturing PMI (Apr) market 52.0, previous 51.5
- (11 EDT/1500 GMT) Construction Spending (Mar) market +0.5% m/m, previous -0.1% m/m
- (11 EDT/1500 GMT) UOM Consumer Sentiment Index (final April) market 96.0, previous 95.9
- (11 EDT/1500 GMT) UOM Current Conditions Index (final April) market 108.3, previous 108.2
- (11 EDT/1500 GMT) UOM Expectations Index (final April) market 88.1, previous 88.0
- N/A Total Vehicle Sales (April) market 16.90 mln SAAR, previous 17.15 mln SAAR
- N/A Domestic Car Sales (April) market 5.49 mln SAAR, previous 5.45 mln SAAR
- N/A Domestic Light Truck Sales (April) market 8.00 mln SAAR, previous 8.24 mln SAAR
Key Events Ahead
- (0930 EDT/1330 GMT) FRB Cleveland’s Mester on “Issues in Consumer Credit”; Philadelphia, PA
- (1045 EDT/1445 GMT) Fed Trade Operation 30-yr Ginnie Mae (max $1.000 bln)
- (1245 EDT/1645 GMT) Fed Trade Operation 15-yr Fannie Mae/Freddie Mac (max $675 mln)
- (1645 EDT/2045 GMT) FRB SF’s Williams on “Monetary Policy in Financial Markets”
FX Recap
EUR/USD touched the 2 month low at 1.1269 levels. Pair made 1.1265 high on April 30, and today again pair posted new high at 1.1269 levels. A daily close above this level bring the pair towards 1.13 levels. As European market is closed so no major data released today. Initial support is seen at 1.1148, 1.1120 levels. On the upper side strong resistance is seen at 1.1371 levels. Option expiries are at 1.1100 (909M), 1.1200 (1.1BLN), 1.1250 (1BLN).USD/JPY pair maintains its upside momentum. It is currently trading at 119.75 after creating the 119.85 level high so far. Moreover, the yen weakened against the US dollar also after sharp fall of the consumer price index in the Tokyo area from 2.2% y/y rise to a mere 0.4% in April. Meanwhile, US ISM manufacturing PMI data will remain the major driver in the day ahead amid quiet European session. On the top side, near term resistance is seen at 119.91 (April 30 high) and support is seen at 119.47, 119.00 levels. Option expiries are at 119.00 (1.3BLN), 119.50 (350M), 120.00 (520M), 121.00 (1.1BLN).GBP/USD disappointed by weak UK manufacturing PMI data. Pair dropped to low at 1.5283 levels. UK data came in mixed today: Manufacturing PMI dropped to 51.9 for the month of April vs. 54.6 forecasted and 54.0 previous, Mortgage Approvals declined to 61.34K during March from 61.52. On the positive side, M4 Money Supply advanced at a monthly pace of 0.3%, BoE Consumer Credit rose to £1.242 billion and Net Lending to Individuals rose to £3.1 billion. After the recent data release, Initial support is seen at 1.5283 (today’s low) and below that 1.5172. Resistance is seen at 1.5498 (April 30 high). Option expiries are at 1.5100 (231M), 1.5450 (272M), 1.5500 (413M).USD/CHF pair is trading in quite range in data free session but made new monthly low at 0.9290. A daily close below 0.9300 levels will open the door of new trading range of 0.9173 to 0.9300. Market awaits USD ISM manufacturing data for the further direction. Near term support is seen at 0.9254 levels and resistance is at 0.9373 levels. Option expiry is at 0.9500 (240M).AUD/USD is trading at 0.7873 levels and made low at 0.7862 levels. USD is appreciating against major peers after yesterday’s better than expected weekly US job data and Chicago PMI numbers. In US trading session traders watch closely ISM Manufacturing PMI data. Next week is also important as RBA will release interest rate decision and majority expecting for the rate cut. Near term support is seen at 0.7858, 0.7781 levels. On the other side, resistance is seen at 0.7920 levels. Option expiries are at 0.7700 (2.6BLN). NZD/USD: 0.7300 (435M).
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