Forex Market Update
This morning, the greenback is trading mostly lower against most of the major currencies, ahead of the US retail sales and weekly jobless claims data.
The EUR is trading lower against the USD even as the ECB, in its monthly bulletin, played down speculations for a deflationary situation in the Euro-zone economy. Yesterday, ECB’s Yves Mersch hinted that the central bank could purchase asset-backed securities as a part of its QE measure while French Finance Minister, Michel Sapin applauded ECB’s last week policy action to promote growth in the economy.
Earlier today, the AUD came under pressure for a brief period of time after data revealed that net employment in Australia declined for the first time in five-months in May even as unemployment rate in the nation remained unchanged at 5.8% for the third straight month.
Yesterday, in the New York session, the greenback traded mostly higher against the key currencies. Data showed that the US budget deficit shrank more than 6.0% from a year earlier to $130.0 billion in May. However, US Treasury Secretary, Jacob Lew expressed concerns on the present challenges faced by the US economy, despite data indicating that the economy has gained traction.
In the UK, a BoE policymaker, Ben Broadbent, acknowledged the economic perils from housing sector in the UK economy while hinting that the central bank could tighten its policy measures only when markets' risk appetite improved.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3520 against the USD, 0.10% lower from the New York close. On the economic front, the ECB, in its monthly report, opined that Euro-zone economy does not seem to be on the brink of deflation, despite recent fall in inflation rate, while another official report showed that the monthly industrial production in the Euro-bloc rebounded twice-as much as expected in April. During the session, the pair traded at a high of 1.3550 and a low of 1.3522. Yesterday, the EUR traded 0.08% lower against the USD in the New York session, and closed at 1.3534.
The pair is expected to find its first support at 1.3503 and first resistance at 1.3547.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6829 against the USD, 0.23% higher from the New York close. Earlier today, the RICS reported that its index on house price balance in the UK rose more-than-expected in May. During the session, the pair traded at a high of 1.6840 and a low of 1.6789. Yesterday, the British Pound traded a tad higher versus the Dollar in the New York session, and closed at 1.6791. A BoE policymaker, Ben Broadbent projected interest rate hike in the UK economy to be gradual due to the prevailing risks in the domestic housing market.
The pair is expected to find its first support at 1.6787 and first resistance at 1.6856.
USD JPY
The USD is trading at 101.97 against the JPY at 9:40 GMT this morning, marginally lower from the New York close. In economic news, machinery order in Japan fell at a slower than anticipated pace in April, pulling back from a record jump in the previous month. During the session, the pair traded at a high of 102.15 and a low of 102.00. In the New York session yesterday, the USD traded marginally higher against the JPY, and closed at 102.00.
The pair is expected to find its first support at 101.84 and first resistance at 102.13.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.9008 against the Swiss Franc, 0.12% higher from the New York close. With no major economic releases in Switzerland later today, traders are expected to keep a tab on global economic news, along with US retail sales and weekly jobless claims data, for further guidance in the currency pair. During the session, the pair traded at a high of 0.9013 and a low of 0.8995. In the New York session yesterday, the USD traded 0.08% higher against the CHF, and closed at 0.8997.
The pair is expected to find its first support at 0.8987 and first resistance at 0.9021.
USD CAD
At 9:40 GMT, the USD is trading at 1.0857 against the CAD, 0.09% lower from the New York close. Traders keenly await Canada’s capacity utilization and new housing price data for further cues in the loonie. During the session, the pair traded at a high of 1.0872 and a low of 1.0858. Yesterday, the USD traded 0.18% lower against the CAD in the New York session, and closed at 1.0867. Moody’s Investors Service lowered its outlook for the senior debt and uninsured deposits of Canada’s seven largest banks to “Negative”, from “Stable.”
The pair is expected to find its first support at 1.0840 and first resistance at 1.0886.
AUD USD
The AUD is trading at 0.9401 against the USD, at 9:40 GMT this morning, 0.18% higher from the New York close. However, earlier the AUD came under pressure after data revealed that net employment in Australia fell for the first time in five months in May even as unemployment rate in the nation stood pat a 5.8% for the third straight month. During the session, the pair traded at a high of 0.9416 and a low of 0.9373. AUD traded 0.07% lower against the USD in the New York session, and closed at 0.9384.
The pair is expected to find its first support at 0.9362 and first resistance at 0.9428.
Gold
At 9:40 GMT, Gold is trading at $1262.20 per ounce, 0.10% higher from the New York close. This morning, Gold traded at a high of $1262.80 and a low of $1260.00 per ounce. In the New York session yesterday, the yellow metal traded 0.21% lower, and closed at $1260.90. However, losses in gold prices were limited as a weakness in global equity markets and World Bank’s decision to slash its forecast on global economic growth bolstered the safe-haven appeal of the metal.
Gold has its first support at $1258.70 and first resistance at $1265.60.
Silver
Silver is trading at $19.24 per ounce, 0.26% higher 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 $19.15. Silver traded 0.39% lower against the USD in the New York session, and closed at $19.19.
Silver has its first support at $19.15 and first resistance at $19.33.
Crude Oil
At 9:40 GMT, Oil is trading at $105.54 per barrel, 1.00% higher from the New York close. This morning, Oil traded at a high of $105.58 and a low of $104.35. Yesterday, Oil traded 0.11% higher in the New York session, and closed at $104.50, after the EIA reported a more-than-expected 2.6 million barrels drop in the US crude supplies last week and as fresh outburst of violence in Iraq renewed concerns on the supply-outlook of the commodity from the Middle East region. Separately, the OPEC left its production ceiling unchanged at 30 million barrels a day at its meeting in Vienna.
It has its first support at $104.61 and first resistance at $106.02.
Economic Snapshot
ECB might resort to further monetary policy easing measures if needed, indicated ECB’s monthly report
The European Central Bank (ECB) in its monthly report for June 2014, indicated that the Euro-zone economy would continue to recover at a moderate pace in the second quarter of 2014 and 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%.
Euro-zone industrial production rose more than expected in April
On a working day adjusted annual basis, industrial production in the Euro-zone rose 1.4% in April, compared to a revised 0.2% rise recorded in the previous month. Markets were expecting industrial production to rise 0.9% in April.
German WPI declined less than expected in May
On a monthly basis, Germany’s wholesale price index fell 0.1% in May, compared to a 0.2% rise recorded in the previous month. Markets had expected the wholesale price index to decline 0.3% in May.
France EU normalised consumer price index remained flat in May
On a monthly basis, France’s EU normalised consumer price index remained flat (0.0%) in May, compared to a similar change in the previous month. Markets had expected the EU normalised consumer price index to rise 0.1% in May.
France current account deficit widened in April
The current account deficit of France widened to €1.6 billion in April, following a deficit of €1.5 billion in the previous month.
Australia’s consumer inflation expectations declined in June
The consumer inflation expectations in Australia fell to 4.0% in June from a rate of 4.4% recorded in the previous month.
Australia’s unemployment rate remained unexpectedly steady in May
On a seasonally adjusted basis, unemployment rate in Australia remained unchanged at 5.8% in May, compared to the previous month. Markets had expected Australia’s unemployment rate to rise to 5.9% in May. Meanwhile, the seasonally adjusted number of people employed in Australia fell by 4.8K in May, compared to a revised rise of 10.3K recorded in the previous month.
Good trades.
