Forex Market Update
This morning, the greenback is trading mostly higher against most of the major currencies, ahead of the US consumer inflation data and few planned speeches from top Fed officials, including the Fed Chief, Janet Yellen.
The EUR is trading lower against the USD, after the German economic sentiment fell for the fourth straight month in April. However, the EUR pared some of its initial losses after Euro-zone trade surplus widened more-than-expected in February and after the ZEW survey on Euro-zone’s economic sentiment and Germany’s current situation came in better than market estimates for April. Yesterday, ECB’s Christian Noyer hinted that the ECB stands prepared to use every instrument in its mandate, including unconventional ones, to combat the risk of prolonged low inflation in the economy.
The AUD lost ground against its US counterpart after the minutes from the RBA’s April policy meeting indicated that a stubbornly high Aussie could dampen Australia’s economic growth even as the central bank believed that its policy measures were appropriate to foster sustainable growth in demand and to assist in achieving 2-3% inflation target.
Yesterday, in the New York session, the greenback traded mostly lower against the key currencies. However, later during the day, the USD advanced against its counterparts after the US retail sales recorded their largest gain in 1-1/2 years in March.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3803 against the USD, 0.12% lower from the New York close, after the German ZEW economic sentiment fell for the fourth month in a row in April. However, ZEW index for Germany’s current conditions and Euro-zone’s economic sentiment surpassed expectations for April while Euro-zone trade surplus widened in February. During the session, the pair traded at a high of 1.3822 and a low of 1.3800. Yesterday, the EUR traded tad higher against the USD in the New York session, and closed at 1.3819.
The pair is expected to find its first support at 1.3783 and first resistance at 1.3829.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6727 against the USD, tad higher from the New York close. However, earlier during the day, the GBP fell after UK’s annual consumer inflation rate declined to a four-year low 1.6% in March and after the BRC retail sales in Britain registered its biggest annual fall since April 2013 in March. During the session, the pair traded at a high of 1.6732 and a low of 1.6694. Yesterday, the British Pound traded 0.13% higher versus the Dollar in the New York session, and closed at 1.6725.
The pair is expected to find its first support at 1.6676 and first resistance at 1.6761.
USD JPY
The USD is trading at 101.81 against the JPY at 9:40 GMT this morning, marginally lower from the New York close. Earlier today, Japan’s Chief Cabinet Secretary, Yoshihide Suga revealed that Prime Minster, Shinzo Abe did not ask the BoJ Governor, Kuroda for additional easing measures at their meeting on Tuesday. During the session, the pair traded at a high of 102.01 and a low of 101.75. In the New York session yesterday, the USD traded marginally lower against the JPY, and closed at 101.85.
The pair is expected to find its first support at 101.63 and first resistance at 102.01.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8811 against the Swiss Franc, 0.15% higher from the New York close. In economic news, the Swiss producer and import prices registered a monthly flat reading in March, following a 0.4% (MoM) drop in the preceding month. During the session, the pair traded at a high of 0.8817 and a low of 0.8800. In the New York session yesterday, the USD traded flat against the CHF, and closed at 0.8798.
The pair is expected to find its first support at 0.8788 and first resistance at 0.8825.
USD CAD
At 9:40 GMT, the USD is trading at 1.0993 against the CAD, 0.26% higher from the New York close, ahead of the release of Canada’s manufacturing shipment data, which could provide an insight into the trend in market demand. During the session, the pair traded at a high of 1.1002 and a low of 1.0964. Yesterday, the USD traded 0.10% lower against the CAD in the New York session, and closed at 1.0964. On the economic front, the Teranet-National Bank composite house price index came in flat in March.
The pair is expected to find its first support at 1.0955 and first resistance at 1.1017.
AUD USD
The AUD is trading at 0.9394 against the USD, at 9:40 GMT this morning, 0.29% lower from the New York close, after the minutes from the RBA’s April policy meeting highlighted policymakers’ concerns on the effect of a stubbornly high Aussie on Australia’s economic growth. During the session, the pair traded at a high of 0.9425 and a low of 0.9385. AUD traded 0.15% higher against the USD in the New York session, and closed at 0.9421.
The pair is expected to find its first support at 0.9372 and first resistance at 0.9421.
Gold
At 9:40 GMT, Gold is trading at $1312.10 per ounce, 1.17% lower from the New York close, amid speculation that improving US economy could dampen demand for safe-haven assets. A report from World Gold Council projected Chinese demand for gold to increase by 25.0% to at least 1,350 tons by 2017. This morning, Gold traded at a high of $1328.40 and a low of $1307.50 per ounce. In the New York session yesterday, the yellow metal traded 0.29% higher, and closed at $1327.70, as social unrest in Ukraine bolstered the safe-haven appeal of the metal.
Gold has its first support at $1302.60 and first resistance at $1326.50.
Silver
Silver is trading at $19.91 per ounce, 0.40% lower from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.99 and a low of $19.70. Silver traded 0.15% higher against the USD in the New York session, and closed at $19.99.
Silver has its first support at $19.71 and first resistance at $20.10.
Crude Oil
At 9:40 GMT, Oil is trading at $103.23 per barrel, 0.30% lower from the New York close, ahead of the US weekly crude inventory report and amid speculation that return of oil supply from Libya could ease concerns on the supply outlook. This morning, Oil traded at a high of $103.58 and a low of $102.91. Yesterday, Oil traded 0.26% lower in the New York session, and closed at $103.54. However, escalating tensions in Ukraine weighed on the demand-prospects of the commodity.
It has its first support at $102.70 and first resistance at $103.96.
Economic Snapshot
UK retail price index rose as expected in March
On an annual basis, the retail price index in UK rose 2.5% in March, in line with market expectations and compared to a 2.7% increase recorded in the previous month.
UK ONS house price index rose in February
On an annual basis, the ONS house price index in the UK rose 9.1% in February, compared to a 6.8% rise recorded in the previous month.
UK consumer price index rose in line with market expectation in March
National Statistics reported that on an annual basis, the UK consumer price index rose 1.6% in March, in line with market estimates and compared to a 1.7% rise recorded in the previous month.
Euro-zone trade surplus widened more than expected in February
The non-seasonally adjusted trade surplus in the Euro-zone rose to €13.6 billion in February, more than market forecasts and compared to a revised surplus of €0.8 billion recorded in the previous month.
Euro-zone economic sentiment fell less than market estimate in April
The ZEW survey - economic sentiment in the Euro-zone dropped to a level of 61.2 in April, more than market expectation of a level of 60.7 and compared to a reading of 61.5 reported in the previous month.
German ZEW sentiment index fell more than expected in April
The ZEW survey - economic sentiment index in Germany dropped to a level of 43.2 in April, more than market expectation of a level of 45.0 and compared to a reading of 46.6 reported in the previous month. Meanwhile, the ZEW survey - current situation index in Germany climbed to a level of 59.5 in April, compared to a reading of 51.3 reported in the previous month.
Swiss producer and import prices remained flat as expected in March
On a monthly basis, producer and import prices in Switzerland remained flat in March, in line with market expectations and following a decrease of 0.4% recorded in the preceding month.
RBA minutes reiterated central bank’s policy stance
The minutes of the Reserve Bank of Australia’s (RBA) monetary policy meeting held on 1 April revealed that interest rates in the nation are likely to remain stable in the near term if the economy continues to improve.
China M0 money supply rose less than forecast in March
On an annual basis, M0 money supply in China rose 5.2% in March, less than market expectation of a 7.0% rise and compared to a 3.3% increase recorded in the previous month.
China new Yuan loans advanced more than expected in March
The People's Bank of China reported that the Chinese financial institutions issued CNY1050.0 billion worth of new Yuan loans in March, more than market expectations and compared to CNY644.5 billion of loans issued in the previous month.
China foreign exchange reserves rose in the Q1 2014
China’s foreign exchange reserves rose to $3.95 trillion in the first quarter of 2014, compared to an upwardly revised $3.82 trillion reported in the previous quarter.
Happy pips.
