Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 99.014 | EURUSD 1.30824 | EURJPY 129.535 | AUDUSD 1.04887 | NZDUSD 0.85351 | USDCAD 1.01641 | EURCHF 1.22004 | USDCHF 0.93261 | GBPUSD 1.53212 | EURGBP 0.85395 |

 

Harry Hindsight

·         EUR: Asia saw a quiet start in the Euro then a quick rise as stops were triggered, the move began just before the opening in Tokyo and took some people by surprise in what a currency less inclined to fall foul of this type of action, we opened just below the 1.3020 level but stops were appearing just above the 1.3040 area and obviously to close for comfort, the market rose to just below the 1.3070 as supply started to outstrip the demand, from that point we started to drift lower into the afternoon session in Tokyo dropping to below the 1.3010 as we moved into the grey hour as early risers sold through the opening levels, London started buying the pair taking it to the 1.3050 areas on the back of decent German trade balance numbers and we held around the level into the NYK session, a dip in inventories left the market down around the 1.3030 area before rumours started to circulate about fresh QE measures after the disappointing NFP numbers on Friday, this weekend the USD and we saw the Euro rise to above the 1.3100 level in late trading before dropping back into the close to around the 1.3080 levels.

·         GBP: A quiet day in the Cable during Asia were we saw the market opening around the 1.5260 area and peaking just below 1.5280, we dipped below the opening levels in the grey hours as Euro’s dropped and dragged GBP with it however, a good round of numbers showing a much improved production data to go with the falling employment would seem to suggest that the only number out of line is the GDP figure, with the only number that remained worrying being the Visible trade balance, we rallied from the lows around 1.5250 to above the 1.5320 in a quick sustained move, the EURGBP cross lost ground as GBP rose steadily against the Euro over the course of the session until into the NYK session trading as low as 0.8508 from the high of 0.8560 during Asia. Cable dipped in NYK back down below 1.5300 however, the drop was short lived and we eventually made a high above the 1.5340 level before settling into the 1.5320 area to the close.

·         JPY: The market in Asia opened up gunning for the 100.00 level and just after the Tokyo opening we’d moved to just below 99.70 when a comment released on one of the major news media systems put paid to the rally obviously the tricky translation of past and present tense seemed to have become scrambled as the comment by Aso Excessive Yen gain has been corrected which should have read is being corrected, the market went into a little tail spin moving swiftly down to 99.10 before bouncing slightly however, the damage was done for the day and we never recovered dropping steadily through the lows into the London open looking weak. While the market tried to rally on occasions it struggled for the most part below the 99.00 level peaking above 99.30 and hitting a low below 98.60 but for the most part stuck around the 99.00 areas with a few fingers burnt.

·         AUD: The Oz initially stayed around the 1.0410 opening level and only when JPY started to strengthen did we start to see the Oz rally to just below 1.0450 however, for most of the Asian session it seemed to be mired around the 1.0430 level, London entered the market buying and we saw fresh buying of the AUDUSD moving it to above the 1.0460 over the course of the session and NYK added and we posted a high just short of 1.0510 on the day dipping back to just below the level into the close, with business confidence above the previous number the Oz seems to be struggling to divine its own destiny and moving on the vagaries of other currencies for the moment.

Yesterday’s premiership results

Actual = A | Consensus = C | Previous = P | Revised = R 

23:01     GBP       BRC Sales Like-For-Like YoY Mar A 1.90% | P 2.70%          

23:01     GBP       RICS House Price Balance Mar A -1% | C -4% | P -6% | R -7%

01:30     AUD       NAB Business Confidence Mar A 2 | P 1

01:30     CNY        CPI Y/Y Mar A 2.10% | C 2.50% | P 3.20%              

01:30     CNY        PPI Y/Y Mar A -1.90% | C -1.80% | P -1.60%         

05:45     CHF        Unemployment Rate Mar A 3.10% | C 3.10% | P 3.10%  

06:00     JPY         Machine Tool Orders Y/Y Mar (P) A -21.60% | P -21.50%

06:00     EUR        German Trade Balance (EUR) Feb A 17.1B | C 16.2B | P 15.7B      

07:15     CHF        CPI M/M Mar A 0.20% | C 0.30% | P 0.30%          

07:15     CHF        CPI Y/Y Mar A -0.60% | C -0.50% | P -0.30%         

07:15     CHF        Retail Sales (Real) Y/Y Feb A 2.40% | C 2.90% | P 1.90% | R 2.00%

08:30     GBP       Industrial Production M/M Feb A 1.00% | C 0.30% | P -1.20% | R -1.30%

08:30     GBP       Industrial Production Y/Y Feb A -2.20% | C -2.70% | P -2.90% | R -3.10%

08:30     GBP       Manufacturing Production M/M Feb A 0.80% | C 0.40% | P -1.50% | R -1.90%

08:30     GBP       Manufacturing Production Y/Y Feb A -1.40% | C -1.40% | P -3.00% | R -3.30%

08:30     GBP       Visible Trade Balance (GBP) Feb A -9.4B | C -8.5B | P -8.2B           

12:15     CAD       Housing Starts Mar A 184K | C 176K | P 180.7K | R 178K

12:30     CAD       Building Permits M/M Feb A 1.70% | C 5.30% | P 1.70% 

14:00     USD       Wholesale Inventories Feb A -0.30% | C 0.40% | P 1.20%              

14:00     GBP       NIESR GDP Estimate Mar A 0.10% | P -0.10%

 

For today

USDJPY 
Topside: 99.30-99.70 light offers  99.70-100.00 decent offers  100.00-100.30 medium buy stops 
Downside: 98.70-98.90 light bids 98.30-98.60 decent bids 98.00-98.30 decent sell stops 

EURUSD 
Topside: 1.3100-1.3130 light offers  1.3140-1.3170 light buy stops 
Downside: 1.3050-1.3075 light bids 1.3000-1.3030 light bids 

EURJPY 
Topside: 130.00-130.30 light offers  130.50-130.80 light offers 
Downside: 129.20-129.40 light sell stops  AUDUSD 
Topside: 1.0520-1.0530 light buy stops  1.0540-1.0570 medium offers 
Downside: 1.0450-1.0475 medium sell stops 1.0400-1.0430 light sell stops

 

KRW:

North Korea May Launch Missile as Soon as April 10: Sankei

S. Korea, U.S. Military Raise Watch Alert on N. Korea: Yonhap

CNY:

PBOC fixes yuan mid-point at record 6.2548/dollar

China Posts Trade Deficit for March

JPY:

Manufacturers grateful for Japan government deflation steps-Toyota president

Japan’s Abe Says Bold Easing Will Correct Excessively Strong Yen

Japan March bank loans rise 1.6% vs. year ago

AUD/JPY/USD:

Swan Backs Japan-to-U.S. Stimulus as G-20 Meets, Yen Slides

Australia CB says still scope to ease if needed

Australia’s Swan Says Industry Coping With High Australian Dollar

Australia approves new derivatives market, clearance licences

·         EUR: A quiet session with the Euro stuck in a very tight range with little news to move the markets, we opened just above the 1.3080 mark with a drift lower into the Tokyo session to just above 1.3075 and an attempt higher later in the session to above 1.3090 but neither move was convincing and the volumes seem to be off across the board.

·         GBP: A slow move higher from the opening levels around 1.5318 to trade as high as 1.5338 however, most of the volume seems to be connected to GBPAUD buying on dips moving Cable slightly higher but a quiet day otherwise as we move towards the grey hours above the 1.5330 level.

·         JPY: USDJPY had a quiet day which is a little different from the past few days, we moved up from the 99.00 area to spike above 99.30 in early pre Tokyo trading before slipping back on the opening to just below the opening, since then we’ve stayed in a reasonably quiet range of 15 points from the 99.00 area, and currently hold just above 99.10 as we move towards London.

·         AUD: The Oz opened just above the 1.0490 area and drifted in early trading to below the 1.0480 level before rising quickly on what for the Chinese was a poor number with a -0.9B Trade balance however, for the Oz it was all in the detail and the rise in imports to China from Australia to $5.61B from an average of the past 6months of $3.52B, the Oz shot up to 1.0518 before running into some GBPAUD buying which stopped it from moving any higher, as we move towards the opening the Oz is slipping back a little and currently holding the 1.0500 level.

 

Today’s data

Actual = A | Consensus = C | Previous = P | Revised = R 

CNY        Trade Balance (USD) Mar A -0.9B | C 15.2B | P 15.3B       

AUD       Westpac Consumer Confidence Apr A -5.10% | P 2.00%

14:30     USD       Crude Oil Inventories C 1.5M | P 2.7M   

18:00     USD       Monthly Budget Statement Mar P -203.5B           

18:00     USD       FOMC Minutes                

Interbank Ranges as of 6am London time

                                Highs    Lows

USD/JPY               99.37 | 98.91

EUR/USD             1.30915 | 1.3075

EUR/JPY               129.91 | 129.42

AUD/USD            1.0518 | 1.0474

NZD/USD             0.8537 | 0.8515

USD/CAD             1.0167 | 1.0153

EUR/CHF              1.21995 | 1.2194

USD/CHF             0.9328 | 0.9316

GBP/USD             1.5340 | 1.5311

EUR/GBP             0.85405 | 0.8532

 

Good luck

Andy