Forex Market Update
This morning, the greenback is trading mixed against most of the major currencies, ahead of the US ADP employment data and few planned speeches from top Fed officials.
The EUR is trading tad lower against its US counterpart despite a 0.5% rise in the Euro-zone annual GDP data for the fourth quarter. Yesterday, the ECB Vice President, Vitor Constancio played down the prospect of deflation threats in the economy. However, at the same time he also noted that a prolonged period of low inflation rate could “constitute a drag on the economy’s recovery.”
The GBP is trading higher against the USD as UK house prices registered a rise for a 25th consecutive month in March and following a strong domestic construction PMI data which indicated that the sector was still performing strongly.
In Japan, a survey from the BOJ revealed corporate Japan is not confident about the central bank achieving its 2% inflation goal by the April 2015 target date, on the back of the 3% sales tax hike which came into effect from yesterday. Separately, another survey from the BOJ indicated that nearly 70% of Japanese households planned to cut back on spending after the hike in the nation’s sales tax.
In yesterday’s New York session the USD traded mostly higher against the key currencies. In economic news, the ISM reported a less-than-expected rise in the US manufacturing activities in March while Markit Economics reported that it’s PMI on the US manufacturing sector fell in the previous month.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3792 against the USD, tad lower from the New York close. Euro-zone’s annual GDP rose 0.5% in the fourth quarter while the producer price index dropped more-than-expected in February. During the session, the pair traded at a high of 1.3821 and a low of 1.3790. Yesterday, the EUR traded marginally lower against the USD in the New York session, and closed at 1.3794. The ECB Vice President, Vitor Constancio expressed concerns on the prevailing low inflation in the Euro-zone but at the same time opined that there was no risk of deflation in the economy.
The pair is expected to find its first support at 1.3777 and first resistance at 1.3814.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6644 against the USD, 0.08% higher from the New York close. In economic news, UK construction PMI edged down to a reading of 62.5 in March however it continued to remain in expansion territory. Separately, another report showed that the Nationwide house prices rose 0.4% (MoM) last month. During the session, the pair traded at a high of 1.6665 and a low of 1.6626. Yesterday, the British Pound traded slightly lower versus the Dollar in the New York session, and closed at 1.6631.
The pair is expected to find its first support at 1.6620 and first resistance at 1.6667.
USD JPY
The USD is trading at 103.82 against the JPY at 9:40 GMT this morning, 0.13% higher from the New York close. A BoJ survey released overnight showed that Japanese firms expects consumer prices in the nation to rise to an average of 1.5% a year from now and to 1.7% three years and five years from now, suggesting that the BoJ plan’s to achieve 2% inflation could be at risk. During the session, the pair traded at a high of 103.95 and a low of 103.64. In the New York session yesterday, the USD traded 0.30% higher against the JPY, and closed at 103.69.
The pair is expected to find its first support at 103.43 and first resistance at 104.08.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8842 against the Swiss Franc, 0.06% higher from the New York close. During the session, the pair traded at a high of 0.8846 and a low of 0.8824. In the New York session yesterday, the USD traded 0.12% higher against the CHF, and closed at 0.8837.
The pair is expected to find its first support at 0.8822 and first resistance at 0.8854.
USD CAD
At 9:40 GMT, the USD is trading at 1.1020 against the CAD, 0.09% lower from the New York close. During the session, the pair traded at a high of 1.1043 and a low of 1.1019. Yesterday, the USD traded tad lower against the CAD in the New York session, and closed at 1.1030. The Canadian Dollar advanced after data showed that Canada’s raw materials price index increased 5.7%, the most in almost three years in February and its industrial product price index rose 1.0% (MoM) in the same month.
The pair is expected to find its first support at 1.0998 and first resistance at 1.1056.
AUD USD
The AUD is trading at 0.9243 against the USD, at 9:40 GMT this morning, tad higher from the New York close. However, the Aussie’s initial gains were pared after a report showed the number of building approvals in Australia declined more than market expectations in February, raising concerns over the health of the nation’s housing sector. During the session, the pair traded at a high of 0.9257 and a low of 0.9233. AUD traded marginally lower against the USD in the New York session, and closed at 0.9241.
The pair is expected to find its first support at 0.9220 and first resistance at 0.9269.
Gold
At 9:40 GMT, Gold is trading at $1283.90 per ounce, 0.22% higher from the New York close. This morning, Gold traded at a high of $1284.94 and a low of $1280.51 per ounce. In the New York session yesterday, the yellow metal traded 0.27% lower, and closed at $1281.02, following reports that showed holdings in the SPDR Gold Trust declined to 810.98 metric tons yesterday, the least since 7 March.
Gold has its first support at $1278.29 and first resistance at $1288.92.
Silver
Silver is trading at $19.88 per ounce, 0.43% higher from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.91 and a low of $19.76. Silver traded marginally higher against the USD in the New York session, and closed at $19.80, buoyed by gains in the prices of industrial metals.
Silver has its first support at $19.74 and first resistance at $19.97.
Crude Oil
At 9:40 GMT, Oil is trading at $99.68 per barrel, 0.10% higher from the New York close, ahead of the EIA report on the US weekly crude supplies. This morning, Oil traded at a high of $99.83 and a low of $99.37. Yesterday, Oil traded 1.56% lower in the New York session, and closed at $99.61, as the recent batch of dismal manufacturing PMI data from China and the US weighed on the demand-outlook of the commodity while easing tensions in Libya bolstered the supply prospect of the commodity. Separately, API reported an unexpected 5.8 million barrels drop in the US weekly crude inventory for last week.
It has its first support at $98.83 and first resistance at $100.99.
Economic Snapshot
UK Nationwide house prices rose at a slower pace in March
Nationwide reported that on a seasonally adjusted monthly basis, house prices in UK rose 0.4% in March, compared to a revised increase of 0.7% recorded in the previous month. Markets were expecting house prices to rise 0.8% in March.
UK construction PMI eased unexpectedly in March
The construction purchasing managers’ index (PMI) in UK eased unexpectedly to a reading of 62.5 in March, from a reading of 62.6 in the previous month. Market had expected the index to rise to a reading of 63.0 in March.
Euro-zone producer price index fell in February
On a monthly basis, the producer price index in the Euro-zone fell by 0.2% in February, compared to a 0.3% fall recorded in the previous month.
Euro-zone final GDP rose in Q4 2013
On a seasonally adjusted quarterly basis, final gross domestic product (GDP) in the Euro-zone rose 0.2% in the fourth quarter of 2013, compared to a 0.1% rise recorded in the third quarter of 2013.
Unemployment in Spain declined in March
The number of people unemployed in Spain dropped by 16.6K in March, compared to a decline of 1.9K unemployed reported in the previous month.
Australia building approvals fell more than expected in February
On a seasonally adjusted monthly basis, building approvals in Australia dropped 5.0% in February, compared to a revised 6.9% increase in the previous month. Markets were expecting building approvals to fall 2.0% in February.
Happy pips.
