Forex Market Update
This morning, the greenback is trading mostly lower against most of the major currencies.
The EUR is trading higher against its US counterpart. Earlier today, the ECB’s monthly bulletin showed that the Euro-zone economy still has considerable amount of slackness, which could contain any upside risks to prices as activity picks up. Meanwhile, the report further indicated that the policymakers would take swift action if need arises, including unconventional tools “in order to cope effectively with risks of a too prolonged period of low inflation.”
The GBP is trading on a lower footing, ahead of the BoE’s monthly interest rate decision scheduled later today.
The JPY is trading higher amid strong demand for safe-haven assets and ahead of the BoJ’s minutes.
Demand for the AUD rose after unemployment rate in Australia unexpectedly fell for the first time since September in March, while the Australian economy added more than expected jobs in March.
Yesterday in the New York session, the greenback traded lower against the key currencies after the minutes from the Fed’s March policy meeting defied market expectation for an early rate hike and indicated that the central bank would be cautious in hiking its interest rates. Separately, Fed’s Charles Evans urged the central bank to keep its interest rates low for a prolonged time to combat low inflation.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3863 against the USD, 0.06% higher from the New York close. Earlier today, the ECB, in its monthly report, indicated that slackness in Euro-zone economy still remained substantial and it could dampen upward pressure on inflation. The report further reiterated that the central bank would maintain a loose monetary policy for an extended period of time. During the session, the pair traded at a high of 1.3872 and a low of 1.3840. Yesterday, the EUR traded 0.38% higher against the USD in the New York session, and closed at 1.3854.
The pair is expected to find its first support at 1.3811 and first resistance at 1.3894.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6778 against the USD, 0.09% lower from the New York close, ahead of the BOE’s decision on interest rate and assets purchase facility. Data released overnight showed that the RICS house prices in the UK unexpectedly picked up in March. During the session, the pair traded at a high of 1.6822 and a low of 1.6770. Yesterday, the British Pound traded 0.23% higher versus the Dollar in the New York session, and closed at 1.6793.
The pair is expected to find its first support at 1.6731 and first resistance at 1.6824.
USD JPY
The USD is trading at 101.46 against the JPY at 9:40 GMT this morning, 0.54% lower from the New York close. Earlier today, BoJ’s Ryuzo Miyao expressed confidence in Japan’s economic growth even after a sales-tax hike in April and further opined that gains in consumer spending could drive prices higher. In economic news, Japan’s machine tool orders rose in March while machinery orders declined more than forecast in February. During the session, the pair traded at a high of 102.16 and a low of 101.49. In the New York session yesterday, the USD traded 0.06% lower against the JPY, and closed at 102.01.
The pair is expected to find its first support at 101.22 and first resistance at 101.93.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8779 against the Swiss Franc, 0.19% lower from the New York close. During the session, the pair traded at a high of 0.8808 and a low of 0.8780. In the New York session yesterday, the USD traded 0.36% lower against the CHF, and closed at 0.8796.
The pair is expected to find its first support at 0.8755 and first resistance at 0.8824.
USD CAD
At 9:40 GMT, the USD is trading at 1.0888 against the CAD, marginally higher from the New York close. Traders await Canada’s new housing price index data for further cues in the Canadian Dollar. During the session, the pair traded at a high of 1.0904 and a low of 1.0873. Yesterday, the USD traded 0.40% lower against the CAD in the New York session, and closed at 1.0883.
The pair is expected to find its first support at 1.0850 and first resistance at 1.0934.
AUD USD
The AUD is trading at 0.9448 against the USD, at 9:40 GMT this morning, 0.69% higher from the New York close, after data showed that unemployment rate in Australia surprisingly fell to 5.8% in March and that the economy added more-than-expected 18,100 jobs last month. During the session, the pair traded at a high of 0.9463 and a low of 0.9377. AUD traded 0.14% higher against the USD in the New York session, and closed at 0.9383.
The pair is expected to find its first support at 0.9376 and first resistance at 0.9492.
Gold
At 9:40 GMT, Gold is trading at $1322.20 per ounce, 0.72% higher from the New York close. This morning, Gold traded at a high of $1323.70 and a low of $1310.88 per ounce. In the New York session yesterday, the yellow metal traded 0.75% higher, and closed at $1312.73, after the minutes from the Fed’s latest policy meeting eased concerns on a sooner-than-expected rise in the US interest rates.
Gold has its first support at $1307.55 and first resistance at $1330.27.
Silver
Silver is trading at $20.28 per ounce, 1.81% higher from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $20.32 and a low of $19.87. Silver traded 1.26% higher against the USD in the New York session, and closed at $19.92, amid broad decline in the US Dollar.
Silver has its first support at $19.82 and first resistance at $20.52.
Crude Oil
At 9:40 GMT, Oil is trading at $103.45 per barrel, 0.10% higher from the New York close. However initial gains in the commodity were pared after a report that showed crude oil imports in China fell to a five-month low level in March. This morning, Oil traded at a high of $103.81 and a low of $103.20. Yesterday, Oil traded 0.78% higher in the New York session, and closed at $103.33, amid lingering concerns on the supply outlook of the commodity. However, the gains were capped after the EIA reported a more-than-expected rise of 4.03 million barrels in the US crude stockpiles last week.
It has its first support at $102.60 and first resistance at $104.05.
Economic Snapshot
ECB reiterated its view of maintaining high degree of monetary accommodation
The European Central Bank (ECB) in its monthly report for April 2014, indicated that the central bank’s inflation expectations for the Euro area 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.
France EU normalized consumer price index rose at a slower pace in March
On an annual basis, the EU normalized consumer price index (CPI) in France increased 0.7% in March, compared to a 1.1% rise reported in the previous month. Markets were expecting the EU normalized CPI to rise 0.8% in March.
France manufacturing production rose as expected in February
On a monthly basis, manufacturing production in France rose 0.3% in February, in line with market forecasts and compared to a revised 0.4% rise recorded in the previous month. Meanwhile, on a monthly basis, industrial production in France increased 0.1% in February, following a revised decrease of 0.3% recorded in the preceding month.
Italy industrial production declined in February
On a seasonally adjusted monthly basis, industrial production in Italy fell 0.5% in February, compared to a revised 1.1% increase recorded in the previous month.
Japan machine tool orders rose in March
On an annual basis, preliminary machine tool orders in Japan rose 41.8% in March, compared to a 26.1% rise in the previous month.
Upward price pressures in Japan expected to continue, indicated BoJ’s Miyao
The Bank of Japan (BoJ) Board Member, Ryuzo Miyao, indicated that price pressures in Japan are expected to rise further, on the back of increased consumer spending.
Australia consumer inflation expectations rose in April
Consumer inflation expectations in Australia increased to 2.4% in April, compared to 2.1% recorded in the previous month.
Australia’s unemployment rate fell in March
On a seasonally adjusted basis, unemployment rate in Australia dropped to 5.8% in March compared to a revised 6.1% rate in the previous month. Market had expected Australia’s unemployment rate to remain steady at 6.1% in March. Meanwhile, seasonally adjusted number of people employed in Australia rose by 18.1K in March, compared to an upwardly revised rise of 48.2K in the previous month.
China’s trade balance swung to a surplus in March
Trade balance of China swung to a surplus of $7.71 billion in March, from a deficit of $22.98 billion recorded in the previous month. Market had expected China’s trade surplus to stand at $0.90 billion in March.
Happy pips.
