Forex Market Update
This morning, the greenback is trading mostly higher against most of the major currencies.
The GBP is trading lower against the USD, reversing its yesterday’s gains, on the back of upbeat production data from the UK economy and following IMF’s upbeat view on the growth outlook of the Britain economy. Earlier during the day, the GBP received some support after data indicated that UK’s goods trade deficit narrowed by more-than-forecast in February.
In Japan, the BOJ’s monthly economic survey projected the economy to continue with its moderate pace of expansion in the future despite of some fall in demand due to hike in sales tax.
In yesterday’s New York session the greenback traded lower against the key currencies. The Chicago Fed Chief, Charles Evans cautioned against the premature withdrawal of the Fed’s stimulus measure while the Minneapolis Fed President, Narayana Kocherlakota urged the central bank to take additional policy measures to spur both inflation and jobs in the US. Meanwhile, the IMF opined that a brighter US economic growth outlook could help the world economy withstand weaker recoveries in emerging markets.
The EUR lost ground against the USD after the IMF asked the ECB to opt for additional easing measures to support the Euro-zone’s fragile economic recovery and to enable the region achieve its 2% inflation target. Separately, ECB’s Christian Noyer opined that a weaker EUR would be desirable from “every point of view” in the Euro-zone.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3793 against the USD, marginally lower from the New York close, hurt by an unexpected fall in Germany’s trade surplus data for February. During the session, the pair traded at a high of 1.3809 and a low of 1.3783. Yesterday, the EUR traded tad lower against the USD in the New York session, and closed at 1.3795, after the IMF urged the ECB to undertake additional easing measures to curb deflation in the region and after the ECB’s Christian Noyer highlighted the need for a weaker EUR in the Euro-zone economy.
The pair is expected to find its first support at 1.3766 and first resistance at 1.3817.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6732 against the USD, 0.10% lower from the New York close. In economic news, total trade deficit in the UK narrowed to £2.1billion in February, as a drop in imports outpaced a decline in exports. During the session, the pair traded at a high of 1.6756 and a low of 1.6730. Yesterday, the British Pound traded marginally higher versus the Dollar in the New York session, and closed at 1.6748, after the IMF raised its 2014 growth forecast for UK economy for the second time this year.
The pair is expected to find its first support at 1.6708 and first resistance at 1.6757.
USD JPY
The USD is trading at 102.06 against the JPY at 9:40 GMT this morning, 0.20% higher from the New York close. Earlier today, the BoJ’s monthly economic survey projected the Japanese economy to expand at a moderate space, following a gradual pick up in exports. During the session, the pair traded at a high of 102.17 and a low of 101.87. In the New York session yesterday, the USD traded 0.36% lower against the JPY, and closed at 101.86. The IMF slashed its 2014 growth forecast on Japanese economy to 1.4%, from an earlier estimate of 1.7%.
The pair is expected to find its first support at 101.52 and first resistance at 102.63.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8841 against the Swiss Franc, 0.06% higher from the New York close. During the session, the pair traded at a high of 0.8847 and a low of 0.8833. In the New York session yesterday, the USD traded 0.06% lower against the CHF, and closed at 0.8836.
The pair is expected to find its first support at 0.8822 and first resistance at 0.8863.
USD CAD
At 9:40 GMT, the USD is trading at 1.0938 against the CAD, 0.12% higher from the New York close. During the session, the pair traded at a high of 1.0944 and a low of 1.0916. Yesterday, the USD traded 0.14% lower against the CAD in the New York session, and closed at 1.0925. The CAD benefited from the IMF’s decision to upgrade its growth-forecast on the Canadian economy in 2014. However, gains in the Loonie were limited after data showed that housing starts in Canada unexpectedly declined in March while Canadian building permits fell more-than-expected to the lowest level in a year in February.
The pair is expected to find its first support at 1.0916 and first resistance at 1.0953.
AUD USD
The AUD is trading at 0.9375 against the USD, at 9:40 GMT this morning, 0.17% higher from the New York close, after data from Australia showed that the Westpac consumer sentiment rose to 99.7 points in April while home loans in the nation rose to a seasonally adjusted 2.3% in February. During the session, the pair traded at a high of 0.9388 and a low of 0.9346. The AUD traded 0.13% higher against the USD in the New York session, and closed at 0.9359. Yesterday, the IMF downgraded its 2015 growth forecast for the nation, on the back of weak investment in Australia’s mining sector.
The pair is expected to find its first support at 0.9335 and first resistance at 0.9402.
Gold
At 9:40 GMT, Gold is trading at $1310.48 per ounce, 0.13% higher from the New York close ahead of the release of the US Fed minutes. This morning, Gold traded at a high of $1314.17 and a low of $1308.39 per ounce. In the New York session yesterday, the yellow metal traded 0.21% lower, and closed at $1308.77. However, a weaker US Dollar and mounting concerns between Ukraine and Russia kept the safe-haven metal’s losses in check.
Gold has its first support at $1306.97 and first resistance at $1314.08.
Silver
Silver is trading at $19.95 per ounce, 0.50% lower from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $20.11 and a low of $19.90. Silver traded 0.20% lower against the USD in the New York session, and closed at $20.05.
Silver has its first support at $19.84 and first resistance at $20.12.
Crude Oil
At 9:40 GMT, Oil is trading at $102.38 per barrel, 0.10% higher from the New York close. Late Tuesday, the API reported a more-than-expected weekly rise of 7.1 million barrels in the US crude stockpiles. This morning, Oil traded at a high of $102.49 and a low of $102.03. Yesterday, Oil traded 0.96% higher in the New York session, and closed at $102.24, amid escalating tensions in Ukraine. Crude prices also rose after the EIA raised its average price forecast on crude oil and trimmed its estimates on US crude production this year.
It has its first support at $101.21 and first resistance at $103.13.
Economic Snapshot
UK total trade deficit narrowed in February
UK’s total trade deficit narrowed to £2.06 billion in February, compared to a revised deficit of £2.20 billion recorded in the previous month. Additionally, UK posted a goods trade deficit of £9.09 billion in February, compared to a revised deficit of £9.46 billion recorded in the previous month.
German trade surplus narrowed unexpectedly in February
On a seasonally adjusted basis, Germany’s trade surplus narrowed to €15.7 billion in February, from a revised surplus of €17.3 billion recorded in the previous month. Market had expected Germany’s trade surplus to widen to €17.8 billion in February.
German current account surplus narrowed unexpectedly in February
Germany’s non-seasonally adjusted current account surplus narrowed to €13.9 billion in February, from a revised surplus of €15.2 billion recorded in the previous month. Market had expected Germany’s current account surplus to widen to €18.0 billion in February.
Japan’s economy continues to recover moderately, indicated BoJ monthly survey
The Bank of Japan (BoJ), in its latest monthly economic survey, stated that Japanese economy continues to recover moderately following a gradual pick up in exports. However, the central bank also warned of risks to the nation’s economy due to lingering European debt problem and the pace of US economic recovery.
Australia Westpac consumer confidence inched up in April
On a seasonally adjusted basis, Westpac consumer confidence index in Australia rose 0 to a level of 99.7, compared to a level of 99.5 reported in the previous month.
Home loan approvals in Australia rose more than expected in February
On a seasonally adjusted monthly basis, home loan approvals in Australia rose 2.3%in February, more than market expectation of a rise of 1.5% and compared to a flat change recorded in the preceding month.
Happy pips.
