Forex Market Update
This morning, the greenback is trading lower against the major currencies.
The EUR is trading higher today, extending its previous session’s gains following the ECB official, Benoit Coeure’s yesterday’s comments that he did not see deflation signs in the Euro-zone economy. However, downbeat data from China this morning did undermine the upward momentum of the EUR for some time. Meanwhile, the ECB, in its monthly report, reiterated that its medium to long term inflation expectations continue to remain firmly anchored below, but close to its 2% target. Additionally, the report indicated that interest rates would continue to be low for an extended period of time, to boost the recovery in the region.
Demand for the AUD rose after an official data from Australia showed that the economy added nearly three times more number of jobs in February than analysts’ expectations.
The NZD is trading higher against the USD after the Reserve Bank of New Zealand raised its benchmark interest rate and hinted at plans to end its stimulus measures faster than previously estimated to contain inflation.
Yesterday, the greenback traded mostly lower in the New York session against the key currencies. In a testimony before the Senate Banking Committee, Stanley Fischer, a nominee for Fed Vice Chairman, stated that the US economy would require the US Fed’s accommodative stance to achieve both maximum employment and price stability in the nation.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3956 against the USD, 0.39% higher from the New York close. Earlier today, ECB’s Benoit Coeure hinted that the ECB stands prepared to act if real interest rate for borrowers does not progressively fall in the near future. During the session, the pair traded at a high of 1.3968 and a low of 1.3900. Yesterday, the EUR traded 0.07% higher against the USD in the New York session, and closed at 1.3902, after an ECB official, Benoit Coeure stated that he does not see any signs of deflation in the region’s economy.
The pair is expected to find its first support at 1.3885 and first resistance at 1.3997.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6687 against the USD, 0.39% higher from the New York close. Early morning, RICS reported that house prices in the UK rose at a slowest pace in six months in February. During the session, the pair traded at a high of 1.6694 and a low of 1.6615. Yesterday, the British Pound traded tad higher versus the Dollar in the New York session, and closed at 1.6622. The BoE Deputy Governor, Charlie Bean indicated that the central bank did not see any urgency in hiking its interest rate, which according to him was solely dependent on the economy’s performance.
The pair is expected to find its first support at 1.6605 and first resistance at 1.6731.
USD JPY
The USD is trading at 102.53 against the JPY at 9:40 GMT this morning, 0.20% lower from the New York close, ahead of the release of the minutes from the BoJ’s latest policy meeting. Overnight, data showed that machinery orders in Japan rose at the fastest pace in almost a year in January. During the session, the pair traded at a high of 102.88 and a low of 102.46. In the New York session yesterday, the USD traded marginally higher against the JPY, and closed at 102.74.
The pair is expected to find its first support at 102.33 and first resistance at 102.80.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8708 against the Swiss Franc, 0.38% lower from the New York close. During the session, the pair traded at a high of 0.8750 and a low of 0.8706. In the New York session yesterday, the USD traded 0.17% lower against the CHF, and closed at 0.8741, amid lack of economic releases.
The pair is expected to find its first support at 0.8678 and first resistance at 0.8758.
USD CAD
At 9:40 GMT, the USD is trading at 1.1060 against the CAD, 0.57% lower from the New York close. During the session, the pair traded at a high of 1.1124 and a low of 1.1059. Yesterday, the USD traded 0.21% lower against the CAD in the New York session, and closed at 1.1123. On the economic front, home prices in Canada rose for the second straight month in February, pushing the Teranet-National Bank composite house price index to a record high.
The pair is expected to find its first support at 1.1022 and first resistance at 1.1126.
AUD USD
The AUD is trading at 0.9069 against the USD, at 9:40 GMT this morning, 0.86% higher from the New York close, after official data showed that employers added 47,300 new jobs in the Australian economy, almost three times more than market expectations. Meanwhile, unemployment rate in the Australian economy came in unchanged at previous month’s level of 6.0%. During the session, the pair traded at a high of 0.9083 and a low of 0.8994. AUD traded 0.48% higher against the USD in the New York session, and closed at 0.8992.
The pair is expected to find its first support at 0.8971 and first resistance at 0.9125.
Gold
At 9:40 GMT, Gold is trading at $1372.45 per ounce, 0.40% higher from the New York close, as lingering tensions over Ukraine lured investors to the commodity’s safe-haven appeal. This morning, Gold traded at a high of $1375.21 and a low of $1365.00 per ounce. In the New York session yesterday, the yellow metal traded 0.15% higher, and closed at $1367.05.
Gold has its first support at $1359.76 and first resistance at $1380.18.
Silver
Silver is trading at $21.41 per ounce, 0.38% higher from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $21.47 and a low of $21.25. Silver traded 1.10% higher against the USD in the New York session, and closed at $21.32, as a weaker US Dollar and concerns over Ukraine crisis bolstered the demand-outlook of the metal.
Silver has its first support at $21.00 and first resistance at $21.64.
Crude Oil
At 9:40 GMT, Oil is trading at $97.88 per barrel, 0.30% lower from the New York close. This morning, Oil traded at a high of $98.48 and a low of $97.83. Yesterday, Oil traded 0.12% lower in the New York session, and closed at $98.18, after the EIA reported a more-than-expected rise of 6.2 million barrels in the US crude stockpiles. However, the losses were kept in check after OPEC forecasted a rise in global oil demand for 2014 and turmoil in Libya.
It has its first support at $97.24 and first resistance at $98.83.
Economic Snapshot
UK RICS house price balance fell in February
The RICS house price balance in the UK dropped to a level of 45.0% in February, following a revised increase of 52.0% in the preceding month.
ECB reiterated to maintain the high degree of monetary accommodation
The European Central Bank (ECB) in its monthly report for March 2014, indicated that the central bank’s inflation expectations for the Euro-zone over the medium to long term continue to be firmly anchored below, but close to 2.0%. The central bank reiterated that its interest rates would remain at present or lower levels for an extended period of time.
Fed’s Fischer called for continued accommodative policy amid labor market woes
Stanley Fischer, the incoming Federal Reserve (Fed) Vice-Chairman, opined that the US still needs expansionary monetary policy, citing the continued weakness in the nation’s labor market.
France EU normalized consumer price index rose above expectations in February
On an annual basis, the EU normalized consumer price index (CPI) in France increased 1.1% in February, compared to a 0.8% rise reported in the previous month. Markets were expecting the EU normalized CPI to rise 1.0% in February.
Italy Consumer Price Index rose less than the preliminary estimate in February
On an annual basis, the EU normalized final consumer price index in Italy rose 0.4% in February, compared to 0.5% rise reported in the preliminary estimate, following a rise of 0.6% in the previous month. Meanwhile, on an annual basis, the final consumer price index in Italy rose 0.5% in February, compared to a 0.7% rise recorded in the previous month.
Spain retail sales rose unexpectedly in January
On an annual basis, retail sales in Spain advanced 0.5% in January, compared to a 1.0% decrease in the previous month. Markets were expecting retail sales to drop 0.8% in January.
Australia consumer inflation expectations fell in March
Consumer inflation expectations in Australia declined to 2.1% in March, compared to 2.3% recorded in the previous month.
Australia’s unemployment rate remained steady in February
On a seasonally adjusted basis, unemployment rate in Australia remained unchanged at 6.0% in February, in line with market expectations and compared to a similar rate in the previous month. Meanwhile, seasonally adjusted number of people employed in Australia rose by 47.3K in February, compared to a revised rise of 18.0K in the previous month.
China industrial production rose at a slower pace in February
On an annual basis, industrial production in China rose 8.6% in February, compared to a 9.7% rise recorded in December. Markets were expecting industrial production to rise 9.5% in February.
China urban fixed-asset investment rose at a slower pace in February
On a year-to-date basis, fixed assets investments excluding rural household in China rose 17.9% in the first two months of 2014, less than market expectations for a 19.4% rise and compared to a 19.6% increase recorded in 2013.
China retail sales rose at a slower pace in February
On an annual basis, retail sales in China advanced 11.8% in February, compared to a 13.6% increase recorded in December. Markets were expecting retail sales to rise 13.5% in February.
Happy pips.
