Forex Market Update
This morning, the greenback is trading mostly lower against most of the major currencies, ahead of the US ISM manufacturing PMI data and a planned speech from the Fed Chief, Janet Yellen.
The GBP is trading higher taking cues from the latest batch of strong economic releases from the UK economy. Yesterday, in a testimony before lawmakers, BoE’s Andrew Haldane opined that policymaker’s estimates on Britain’s economic slackness seemed reasonable while adding that expectations for a gradual interest rate hike remained the most important element in the BoE's forward guidance.
Earlier during the day, the AUD gained ground after data showed that import and export prices in Australia rose more than market expectations for the first quarter. However, the AiG performance of manufacturing index in Australia fell to its lowest level since July 2013 in April.
In Yesterday’s New York session, the greenback traded mostly lower against the key currencies, after the US GDP registered its slowest quarterly growth since the end of 2012 in the first quarter. However, upbeat ADP employment data and the Fed’s decision to taper its stimulus package by $10 billion, kept the currency’s losses in check.
In the Euro-zone, Italy’s Finance Minister, Pier Carlo Padoan, opined that he did not expect a strong fall in the Euro currency in the foreseeable future but added that he supported a weak Euro for the betterment of the economy’s growth.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3882 against the USD, 0.10% higher from the New York close, in a subdued trading session on account of a Labor Day public holiday in most of the Euro-zone’s member nations.During the session, the pair traded at a high of 1.3890 and a low of 1.3868. Yesterday, the EUR traded 0.06% higher against the USD in the New York session, and closed at 1.3868. Late Wednesday, Italy’s Finance Minister, Padoan, played down speculations for a strong depreciation in the Euro but also advocated a softer Euro for Euro-zone’s economic development.
The pair is expected to find its first support at 1.3838 and first resistance at 1.3908.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6904 against the USD, 0.17% higher from the New York close, after the UK Markit manufacturing PMI rose to a 5-month high reading in April and after the Nationwide house prices rose at the fastest pace since June 2007 in March. However, UK mortgage approvals fell in March while consumer lending posted its biggest increase since September 2012. During the session, the pair traded at a high of 1.6923 and a low of 1.6874. Yesterday, the British Pound traded 0.16% higher versus the Dollar in the New York session, and closed at 1.6875.
The pair is expected to find its first support at 1.6836 and first resistance at 1.6948.
USD JPY
The USD is trading at 102.21 against the JPY at 9:40 GMT this morning, tad lower from the New York close, ahead of Japan’s unemployment and household spending data for March. Earlier today, data showed that vehicle sales in Japan, Asia’s second-largest auto market, fell to the lowest since December 2012 in April, as a hike in the nation’s sale tax weighed on demand. During the session, the pair traded at a high of 102.32 and a low of 102.19. In the New York session yesterday, the USD traded 0.08% lower against the JPY, and closed at 102.22.
The pair is expected to find its first support at 101.93 and first resistance at 102.58.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8788 against the Swiss Franc, 0.15% lower from the New York close, in a holiday-thin trading session. During the session, the pair traded at a high of 0.8804 and a low of 0.8787. In the New York session yesterday, the USD finished flat against the CHF, and closed at 0.8801.
The pair is expected to find its first support at 0.8771 and first resistance at 0.8815.
USD CAD
At 9:40 GMT, the USD is trading at 1.0974 against the CAD, 0.09% higher from the New York close. During the session, the pair traded at a high of 1.0977 and a low of 1.0963. Yesterday, the USD traded 0.07% higher against the CAD in the New York session, and closed at 1.0964. In economic news, official data confirmed that the Canadian economy expanded in-line with economists’ expectations for February while Canada’s raw material price index and industrial product prices fell short of analysts’ projections for March.
The pair is expected to find its first support at 1.0950 and first resistance at 1.0990.
AUD USD
The AUD is trading at 0.9284 against the USD, at 9:40 GMT this morning, flat from the New York close. Overnight, the AiG performance of manufacturing index in Australia fell to its lowest level since July 2013 in April while Australia export and import price indices surpassed market expectation in the first quarter. Separately, China’s NBS manufacturing PMI ticked up for the second consecutive month in April but the rise was less than analysts’ call. During the session, the pair traded at a high of 0.9315 and a low of 0.9284. AUD traded tad higher against the USD in the New York session, and closed at 0.9284.
The pair is expected to find its first support at 0.9252 and first resistance at 0.9316.
Gold
At 9:40 GMT, Gold is trading at $1283.50 per ounce, 0.60% lower from the New York close, as most of the markets in Europe and Asia, including Chinese and Indian markets, remained closed for observing a Labor Day public holiday. This morning, Gold traded at a high of $1293.00 and a low of $1281.80 per ounce. In the New York session yesterday, the yellow metal traded 0.18% lower, and closed at $1291.20, after the Fed trimmed the size of its QE measure by $10 billion.
Gold has its first support at $1277.40 and first resistance at $1294.00.
Silver
Silver is trading at $19.12 per ounce, 0.36% lower from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.25 and a low of $19.03. Silver traded 0.65% lower against the USD in the New York session, and closed at $19.19, amid a broad decline in the prices of industrial metals.
Silver has its first support at $18.95 and first resistance at $19.37.
Crude Oil
At 9:40 GMT, Oil is trading at $99.28 per barrel, 0.40% lower from the New York close. This morning, Oil traded at a high of $99.78 and a low of $99.20. Yesterday, Oil traded 0.58% lower in the New York session, and closed at $99.72, after the EIA indicated that US crude oil stockpiles rose by 1.7 million barrels and recorded a fresh record high last week. Oil prices also came under pressure after reports showed that Libya’s Zueitina oil port resumed operations after 10 months of closure.
It has its first support at $98.81 and first resistance at $100.14.
Economic Snapshot
UK Markit manufacturing PMI climbed unexpectedly in April
Markit Economics reported that its manufacturing Purchasing Managers’ Index (PMI) for UK surprisingly climbed to a reading of 57.3 in April, from a revised reading of 55.8 in the previous month. Market had expected the index to ease to a reading of 55.4 in April.
UK consumer credit rose more than expected in March
Net consumer credit in the UK rose by £1.13 billion in March, following a revised rise of £0.58 billion recorded in the prior month. Markets were expecting net consumer credit to rise by £0.60 billion in March.
UK net lending to individuals rose in March
Net lending to individuals in the UK climbed by £2.9 billion in March, compared to a £2.1 billion increase in the previous month. Additionally, net lending secured on dwellings increased by £1.8 billion in March, compared to a revised rise of £1.6 billion recorded in the previous month.
UK mortgage approvals declined unexpectedly in March
The number of mortgage approvals for house purchases in the UK dropped to a level of 67.13K in March, compared to revised 69.59K approvals reported in the previous month. Market had expected mortgage approvals to rise to 71.05K in March.
UK Nationwide house price index rose more than forecast in April
On an annual basis, Nationwide house price index in the UK rose 10.9% in April, more than market expectation of a 10.0% increase and compared to a 9.5% rise recorded in the previous month.
Japan’s vehicle sales declined sharply in April
On an annual basis, Japanese vehicle sales dropped 11.4% in April, following an increase of 14.5% recorded in the preceding month.
Australia import and export price indices rose in the Q1 2014
On a quarterly basis, the import price index in Australia climbed 3.2% in Q1 2014, compared to a 0.6% fall recorded in Q4 2013. Meanwhile, on a quarterly basis, the export price index in Australia rose 3.6% in Q1 2014, compared to a decrease of 0.5% reported in the Q4 2013.
Australia RBA commodity price index declined further in April
Commodity price index in Australian dollar terms fell to 100.2 in April, compared to a revised level of 104.2 reported in the previous month.
China official manufacturing PMI rose less than expected in April
The official manufacturing Purchasing Managers’ Index (PMI) in China rose to a level of 50.4 in April, from a reading of 50.3 in the previous month. Market had expected the index to rise to 50.5 in April.
Good trades.
