Forex Market Update
This morning, the greenback is trading lower against most of the major currencies.
The EUR is trading higher against its US counterpart, buoyed by strong employment figures from Spain and after Euro-zone’s composite PMI rose at its fastest pace in almost three years in April while retail sales in the region posted a surprise month-on-month rise in March.
Late Monday, the ECB’s Yves Mersch hinted that the central bank did not see any deflationary risk in the Euro-zone economy over the medium term, despite the data suggesting otherwise.
In Australia, the RBA kept its benchmark interest rate unchanged at record low 2.5% for the ninth straight month and reiterated its earlier view for interest rate to remain stable for some more time in the economy. Separately, the RBA Governor, Glenn Stevens noted some improvement in the nation’s labor market while adding that local employment market was still quite weak and that the exchange rate at current level was still quite high.
In yesterday’s New York session, the greenback traded mostly higher against the key currencies, benefited from an ISM report that showed activities in the US non-manufacturing sector gained momentum in April. However, a separate report from Markit Economics revealed that growth in US services sector slowed slightly in last month.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3926 against the USD, 0.37% higher from the New York close, buoyed by the recent upbeat employment data from Spain and strong Euro-zone’s Markit PMI and retail sales data for March. During the session, the pair traded at a high of 1.3932 and a low of 1.3874. Yesterday, the EUR traded 0.06% lower against the USD in the New York session, and closed at 1.3875.
The pair is expected to find its first support at 1.3887 and first resistance at 1.3949.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6949 against the USD, 0.48% higher from the New York close, benefiting from a report that highlighted a four month high reading in UK Markit service PMI for April. During the session, the pair traded at a high of 1.6953 and a low of 1.6869. Yesterday, the British Pound traded flat versus the Dollar in the New York session, and closed at 1.6868.
The pair is expected to find its first support at 1.6884 and first resistance at 1.6984.
USD JPY
The USD is trading at 101.93 against the JPY at 9:40 GMT this morning, 0.22% lower from the New York close. The JPY is trading higher, extending its yesterday’s gain on the back of strong demand for safe-haven assets. Looking forward, traders would eye the minutes from the BoJ’s latest policy meeting for further cues in the currency. During the session, the pair traded at a high of 102.21 and a low of 101.95. In the New York session yesterday, the USD traded 0.23% higher against the JPY, and closed at 102.15.
The pair is expected to find its first support at 101.81 and first resistance at 102.13.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8741 against the Swiss Franc, 0.42% lower from the New York close. During the session, the pair traded at a high of 0.8782 and a low of 0.8743. In the New York session yesterday, the USD traded 0.11% higher against the CHF, and closed at 0.8778.
The pair is expected to find its first support at 0.8723 and first resistance at 0.8771.
USD CAD
At 9:40 GMT, the USD is trading at 1.0945 against the CAD, 0.10% lower from the New York close. Market participants keenly await Canada’s trade balance and Ivey PMI data for further guidance in the Loonie. During the session, the pair traded at a high of 1.0962 and a low of 1.0947. Yesterday, the USD traded 0.29% lower against the CAD in the New York session, and closed at 1.0956.
The pair is expected to find its first support at 1.0926 and first resistance at 1.0978.
AUD USD
The AUD is trading at 0.9311 against the USD, at 9:40 GMT this morning, 0.37% higher from the New York close. Earlier today, the RBA kept its interest rate unchanged at 2.5% for the ninth month in a row in May and reiterated a period of stability in the same. Separately, data showed that trade surplus in Australia narrowed more-than-expected to a seasonally adjusted $731 million in March. During the session, the pair traded at a high of 0.9319 and a low of 0.9278. AUD traded 0.14% higher against the USD in the New York session, and closed at 0.9277.
The pair is expected to find its first support at 0.9271 and first resistance at 0.9335.
Gold
At 9:40 GMT, Gold is trading at $1309.30 per ounce, marginally lower from the New York close. However, earlier, gold prices advanced as mounting tensions in Ukraine bolstered the safe-haven appeal of the metal. This morning, Gold traded at a high of $1314.30 and a low of $1308.00 per ounce. In the New York session yesterday, the yellow metal traded 0.39% lower, and closed at $1309.70.
Gold has its first support at $1306.27 and first resistance at $1314.07.
Silver
Silver is trading at $19.64 per ounce, 0.28% higher from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.70 and a low of $19.51. Silver traded 0.61% lower against the USD in the New York session, and closed at $19.58, tracking losses in the prices of gold.
Silver has its first support at $19.51 and first resistance at $19.75.
Crude Oil
At 9:40 GMT, Oil is trading at $99.72 per barrel, 0.40% higher from the New York close. This morning, Oil traded at a high of $99.86 and a low of $99.32. Yesterday, Oil traded 0.71% lower in the New York session, and closed at $99.34, as lingering concerns on demand-outlook in China and easing worries on Libya’s supply prospect, weighed on the prices of crude oil. However, escalating violence in Ukraine kept the commodity’s losses in check.
It has its first support at $98.97 and first resistance at $100.41.
Economic Snapshot
OECD trimmed its global growth forecast for 2014
The Organisation for Economic Cooperation and Development (OECD) lowered its 2014 global economic growth forecast to 3.4% from 3.6% it had projected in November 2013, while maintaining its 2015 growth estimate at 3.9%.
UK services PMI rose more than expected in April
Markit Economics reported that the services Purchasing Managers’ Index (PMI) in UK rose to a level of 58.7 in April, following a reading of 57.6 in the previous month. Market had expected the index to rise to a reading of 57.8 in April.
UK official reserves rose in April
The Bank of England (BoE) reported that the UK’s official reserves rose by $139.0 million in April, compared to fall of $660.0 million reported in the previous month.
Euro-zone final services PMI rose in line with the preliminary estimate in April
Markit Economics reported that the final services Purchasing Managers’ Index (PMI) in the Euro-zone rose to a reading of 53.1 in April, in line with the flash estimate and compared to the final reading of 52.2 in the previous month. Additionally, the final composite PMI in the Euro-zone increased to a level of 54.0 in April, compared to the final reading of 53.1 reported in the previous month.
Euro zone retail sales rose unexpectedly in March
On a monthly basis, retail sales in the Euro-zone rose 0.3% in March, following a revised increase of 0.1% recorded in the preceding month. Markets were expecting retail sales to drop 0.2% in March.
Germany services PMI rose less than the preliminary estimate in April
Markit Economics reported that the final services Purchasing Managers’ Index (PMI) in Germany increased to a level of 54.7 in April, less than the preliminary estimate of 55.0 and compared to the final reading of 53.0 in the previous month.
France services PMI declined less than the preliminary estimate in April
Markit Economics reported that the final services Purchasing Managers’ Index (PMI) in France dropped to a reading of 50.4 in April, less than the preliminary estimate of 50.3 and compared to the final reading of 51.5 reported in the previous month.
Italy services PMI rose in April
Markit Economics reported that the services Purchasing Managers’ Index (PMI) in Italy increased to a reading of 51.1 in April, from a reading of 49.5 in the previous month.
Unemployment in Spain declined in April
Unemployed persons in Spain fell by 111.6K in April, compared to a fall of 16.6K reported in the previous month.
Australia’s trade surplus narrowed in March
Australia’s seasonally adjusted trade surplus narrowed to A$731.0 million in March, compared to a revised surplus of A$1257.0 million recorded in the previous month.
RBA maintained its key interest rate steady
The Reserve Bank of Australia (RBA) announced to keep its key interest rate unchanged at 2.5%, in line with market expectations. The RBA Governor, Glenn Stevens, reiterated that interest rates are likely to remain at the current levels in the near future, given the improving domestic and global economic prospects.
Good trades.
