Forex Market Update
This morning, the greenback is trading mostly lower against most of the major currencies. Earlier, the Fed Chief, Janet Yellen opined that, despite the recent progress, the US economy still has a long way to reach a healthy level.
The EUR is trading higher against the USD, benefited from a strong trade balance data from the Euro-zone for March. Late Thursday, ECB’s Yves Mersch revealed that the central bank is looking at possibly more policy tools to act swiftly in case of emergency.
In a noteworthy event, the IMF indicated that the French economy would have to grow at the pace of 0.5% each quarter to achieve its 1.0% growth target in 2014.
Yesterday, in the New York session, the greenback traded lower against the key currencies, even as US weekly jobless claims hit seven year low last week and consumer prices rose at the fastest pace in 10 months in April.
In Canada, manufacturing shipments rose for the sixth time in seven months in March while the BoC’s Lawrence Schembri highlighted the need for relatively low interest rates in the economy for some more time to achieve 2.0% inflation target.
Late Yesterday, New Zealand’s Finance Minister, Bill English opined that the NZD still remains high at current levels and that it is causing problems in rebalancing the economy.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3717 against the USD, a tad higher from the New York close. In economic data, the Euro-zone trade surplus widened more-than-expected to a non-seasonally adjusted €17.1 billion in March while French non-farm payrolls declined 0.1% in Q1. During the session, the pair traded at a high of 1.3727 and a low of 1.3711. Yesterday, the EUR traded 0.39% higher against the USD in the New York session, and closed at 1.3711. An ECB policymaker, Yves Mersch hinted that the central bank is working on different policy tools and is ready to act swiftly if required.
The pair is expected to find its first support at 1.3666 and first resistance at 1.3751.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6806 against the USD, 0.09% higher from the New York close, amid lack of economic releases from the UK economy. During the session, the pair traded at a high of 1.6815 and a low of 1.6787. Yesterday, the British Pound traded 0.14% higher versus the Dollar in the New York session, and closed at 1.6791.
The pair is expected to find its first support at 1.6760 and first resistance at 1.6833.
USD JPY
The USD is trading at 101.53 against the JPY at 9:40 GMT this morning, marginally lower from the New York close. Data released overnight showed that industrial production in Japan rose more than market expectations and capacity utilization rose at a faster pace in March. During the session, the pair traded at a high of 101.66 and a low of 101.46. In the New York session yesterday, the USD traded 0.36% lower against the JPY, and closed at 101.57, as the latter advanced amid strong demand for safe-haven assets following soft economic releases from the Euro-zone.
The pair is expected to find its first support at 101.19 and first resistance at 101.98.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8904 against the Swiss Franc, slightly lower from the New York close. During the session, the pair traded at a high of 0.8912 and a low of 0.8902. In the New York session yesterday, the USD traded 0.49% lower against the CHF, and closed at 0.8908.
The pair is expected to find its first support at 0.8871 and first resistance at 0.8949.
USD CAD
At 9:40 GMT, the USD is trading at 1.0872 against the CAD, marginally lower from the New York close. During the session, the pair traded at a high of 1.0888 and a low of 1.0873. Yesterday, the USD ended flat against the CAD in the New York session, and closed at 1.0875. The BoC Deputy Governor, Lawrence Schembri hinted that interest rates in Canada would remain relatively low for a longer time to push inflation to its 2.0% target. Separately, data showed that manufacturing shipments in Canada rose for the sixth time in seven months in March
The pair is expected to find its first support at 1.0858 and first resistance at 1.0890.
AUD USD
The AUD is trading at 0.9361 against the USD, at 9:40 GMT this morning, 0.05% higher from the New York close. Early morning, China, Australia’s largest trading parent reported that it witnessed a slowdown in foreign direct investment during April. During the session, the pair traded at a high of 0.9367 and a low of 0.9342. AUD traded 0.15% higher against the USD in the New York session, and closed at 0.9356.
The pair is expected to find its first support at 0.9331 and first resistance at 0.9385.
Gold
At 9:40 GMT, Gold is trading at $1294.20 per ounce, 0.15% lower from the New York close. This morning, Gold traded at a high of $1298.30 and a low of $1291.80 per ounce. In the New York session yesterday, the yellow metal traded 0.08% higher, and closed at $1296.10, as a broad decline in the US equity markets lured investors to the metal for alternate investment. However, the recent batch of strong economic releases from the US economy capped the gains in the commodity.
Gold has its first support at $1287.73 and first resistance at $1303.83.
Silver
Silver is trading at $19.40 per ounce, 0.61% lower from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.53 and a low of $19.33. Silver traded 0.15% lower against the USD in the New York session, and closed at $19.52.
Silver has its first support at $19.24 and first resistance at $19.66.
Crude Oil
At 9:40 GMT, Oil is trading at $101.57 per barrel, marginally lower from the New York close. This morning, Oil traded at a high of $102.04 and a low of $101.39. Yesterday, Oil traded 0.50% lower in the New York session, and closed at $101.60, amid easing supply concerns as Libya produced 300,000 barrels of oil after its El Feel and Wafa oil fields resumed operations. However, the IEA raised its forecast on global oil demand and projected the need for the OPEC to pump 800,000 barrels more crude oil per day in second half of 2014.
It has its first support at $101.14 and first resistance at $102.13.
Economic Snapshot
Euro-zone trade surplus widened more than expected in March
The Eurostat reported that the Euro-zone posted a non-seasonally adjusted trade surplus of €17.1 billion in March, compared to a revised surplus of €14.2 billion recorded in the previous month. Markets were expecting the non-seasonally adjusted trade surplus in the Euro-zone to widen to €16.0 billion in March.
Euro-zone EU 27 new car registrations rose at a slower pace in April
The European Automobile Manufacturers' Association (ACEA) reported that on an annual basis, EU 27 new car registrations in the Euro-zone rose 4.6% in April, compared to a 10.6% rise in the previous month.
France’s non-farm payrolls declined in line with the market estimates in Q1 2014
The National Institute of Statistics and Economic Studies (INSEE) reported that on a quarterly basis, the preliminary non-farm payrolls in France dropped 0.1% in Q1 2014, in line with market expectations and compared to a 0.1% increase recorded in the previous quarter.
Italy’s trade surplus widened unexpectedly in March
The National Institute of Statistics reported that the global trade surplus in Italy widened to €3.87 billion in March, from a revised surplus of €2.63 billion recorded in the previous month. Markets had expected Italy’s global trade surplus to narrow to €2.47 billion in March.
Japan capacity utilization rose in March
The Ministry of Economy, Trade and Industry of Japan reported that on a monthly basis, capacity utilization in Japan rose 0.4% in March, compared to a 2.6% decline recorded in the previous month.
Japan industrial production advanced more than the preliminary estimate in March
The Ministry of Economy, Trade and Industry of Japan reported that on an annual basis, the final industrial production in Japan rose 7.4% in March, higher than the preliminary estimate of a 7.0% rise and compared to a 7.0% increase recorded in the previous month.
China’s foreign direct investment climbed in April
The Ministry of Commerce of the People’s Republic of China reported that on an annual basis, actual foreign direct investment (FDI) in China climbed3.4% in April, compared to a 1.5% decline recorded in March. Markets had expected China’s actual FDI to rise 1.0% in April.
China’s MNI business sentiment index rose in May
The MNI business sentiment index in China climbed to 53.7 in May from a level of 51.1 reported in the previous month.
Good trades.
