Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 108.554 | EURUSD 1.13862 | AUDUSD 0.7683 | NZDUSD 0.69225 | USDCAD 1.27632 | USDCHF 0.95523 | GBPUSD 1.42746 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.13915 | 1.13657

USDJPY                 108.941 | 108.508

GBPUSD               1.42797 | 1.42577

AUDUSD              0.77159 | 0.76726

USDCHF               0.95718 | 0.95492

USDCAD               1.27794 | 1.27509

NZDUSD               0.69528 | 0.69141

EURGBP               0.79836 | 0.79664

EURJPY                 123.782 | 123.517

EURCHF                1.08794 | 1.08711

 

For Today

• EUR: The market drifted through the Asian session trading into the Tokyo session just slightly off the opening levels, and then dipping from the opening levels in a steady decline to the 1.1370 areas and decent two way trading through to the grey hour, Topside offers light into the 1.1400 areas with likely stronger offers in the way but insurmountable and a push through to te 1.1420 areas is likely to have weak stops and the potential to again test to the 1.1460 areas with stronger offers likely on the way to 1.1500 areas, US retail sales and inflationary numbers are the ones to watch for the day, Downside has light bids through the current lows and a break below the 1.1340 level could see weak stops and the 1.1320-00 areas tested with the market possibly becoming weak on a move through the 1.1280 areas.
• GBP: Very quiet ranging day for the Cable with the market holding around the 1.4270 levels for the most part with a brief move towards the 1.4280 levels into Tokyo, Topside offers are thing on the ground through the 1.4300 levels with likely offers around the 1.4350 a little stronger and not really tested in yesterday’s moves, however, possible weak stops will likely lead to a test of a stronger 1.4400 level and continuing in this fashion. Downside is likely to see stronger bids on any attempt to the 1.4200 levels with yesterday’s attempt setting up a fresh support level on the inflationary data, a break here though could see some weak stops and the down side through to 1.4100 areas. US figures and any Brexit commentary to watch for.
• JPY: Abenomics suffering is likely to blame for the increasing woes of a strong JPY however, today saw the market following yesterday’s rejection of the 107.60 areas and the rise from the 108.50 opening pushing steadily towards the 109.00 level as the session moves on, Topside offers remain around the 109.00 levels however, a push through the 109.20 will likely see stops appearing and the market free to test to the 109.80 areas and possibly stronger offers appearing from 110.00 onwards into 110.50. downside still remains a little weak with better bids into the 108.20 areas and through to 107.60 where strong bids are likely however, below will likely see strong stops appearing and the 106.00 level vulnerable.
• AUD: Stronger CNY export data saw the Oz break through the 77 cent level to move towards the 0.7720 levels after a fairly lacklustre day having opened around the 0.7680 areas and dipping into the low 0.7670’s the market once higher has traded quietly around the 77 cent levels, Topside offers into the 0.7720 level are likely to cause problems for the moment a push through the level will likely see some weakness but offers into the 78 cent level are likely to be just as firm if the market can push that far. Downside light bids are likely into the 76 cent levels with better bids starting to move in around the level, a move through the 0.7580 levels are likely to extend through the 75 cent levels and only a strong break through the 0.7500 level will open the downside to further weakness.

Overnight News

CNY:

China’s March Exports Rise 11.5% Y/y in Dollar; Est. 10% Gain

JPY:

BOJ’s Harada: If Risks to Prices Appear, BOJ Should Add Easing

Harada: Can’t Say No Chance BOJ Won’t Lower Neg. Rate in April

Japan’s Abe: Want to Hear Views of Analysis on Global Economy

Japan LDP Mulls Not Passing TPP Bill This Diet Session: Yomiuri

INTERVIEW-IMF’s Furusawa warns of limits to further BOJ rate cuts RTRS

IMF Sees No Cause for Japan to Intervene Now in Currency Market

OECD’s Gurria Says Japan Should Raise Sales Tax as Planned

USD:

Lacker Sees Relatively Balanced Risks to U.S. From Global Events

CNY:

China Won’t Rush Shenzhen-H.K. Stock Link for MSCI Inclusion: HKEJ

China Studies VAT Tax Revenue Distribution Plan: Sec. Journal

AUD:

Australia April Consumer Confidence Falls 4% M/m to 95.1

NZD:

N.Z.’s Key Says Budget Will Include Tax Package for Small Firms

New Zealand’s Key Says No Personal Tax Reform in May Budget

Today’s data

Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT

CNY        Trade Balance Mar A 29.9B | C 34.9B | P 32.6B

JPY         Japan Money Stock M2+CD Y/Y Mar A 3.20% | C 3.10% | P 3.10%

JPY         Domestic CGPI Y/Y Mar A -3.80% | C -3.50% | P -3.40%

AUD       Westpac Consumer Confidence Apr A -4.00% | P -2.20%

09:00     EUR        Eurozone Industrial Production M/M Feb C -0.60% | P 2.10%

12:30     USD       Advance Retail Sales Mar C 0.10% | P -0.10%

12:30     USD       Retail Sales Less Autos Mar C 0.40% | P -0.10%

12:30     USD       PPI M/M Mar C 0.20% | P -0.20%

12:30     USD       PPI Y/Y Mar P 0.00%

12:30     USD       PPI Core M/M Mar C 0.10% | P 0.00%

12:30     USD       PPI Core Y/Y Mar C 1.10% | P 1.20%

14:00     CAD       BoC Rate Decision C 0.50% | P 0.50%

14:00     USD       Business Inventories Feb C -0.10% | P 0.10%

14:30     USD       Crude Oil Inventories P -4.9M

Harry Hindsight              

• EUR: Very limited movement through the Asian session with the Euro remaining around the 1.1410 levels through the session, the move into the London session saw the market slowly tick higher after the German CPI numbers came out unchanged, some light EURGBP buying moved in before the release of the UK data saw the Euro break up through the 1.1440 levels and test lightly above the 1.1460 level before the UK inflation data hit, EURGBP selling was quick and the market moved down to the 0.7960 before Euro finally started to find support in the market and the tumble lower was limited and extended through into the NYK session with weak stops on the break of the 1.1380 level and quickly dipping to below the 1.1350 areas before a bounce occurred, the bounce into the close in London saw the market attempt the 1.1400 levels however, it was week without London and couldn’t maintain the level drifting back to range around the 1.1380 levels for the most part to the close.
• GBP: Cable opened around the 1.4240 levels and struggled through the Asian session unable to make headway, the move into the London session steadily rising to the 1.4280 levels and the release saw the market move steadily through the 1.4300 levels to top just above the 1.4340 before the steady decline in the Euro started to drag as the EURGBP cross held the 0.7960 levels and started to recover, the move back to the 1.4260 levels saw weak stops triggered and the market collapsing back to the 1.4200 levels before a steady recovery saw the market close around the 1.4270 areas. Inflationary data saw a move higher for the most part with headline numbers looking better.
• JPY: USDJPY after a nervous start began a steady recovery over the course of the day having failed the 107.60 areas for the second time the movement in Asia saw the market touch above the 108.20 areas early and then continue through to the London session pushing slowly to the 108.40 levels, London were early sellers of the USD and USDJPY didn’t escape the movement dipping back towards the 108.10 levels before moving into the NYK session extending the highs to the 108.80 levels before slipping back a little into the close.
• AUD: As the USDJPY slowly edged higher the Oz moved with it as AUDJPY carry trade lifted, moving off a good Nab business confidence number the market pushed steadily higher from the lows around 0.7590 and back through 76 cents to trade into the London session around 0.7640 before being sold back a little by early day traders, as it was they were wrong and quickly turned the market back to the highs and the market pushed through the 0.7660 levels unconvincingly for the most part with NYK then replicating the selling that London did and repeating the failure to the downside and the market pushing to the 0.7680 areas into the close.

Yesterday’s premiership results

GBP       BRC Retail Sales Monitor Y/Y Mar A -0.70% | P 0.10%

AUD       NAB Business Confidence Mar A 6 | P 3

EUR        German CPI M/M Mar (F) A 0.80% | C 0.80% | P 0.80%

EUR        German CPI Y/Y Mar (F) A 0.30% | C 0.30% | P 0.30%

GBP       CPI M/M Mar A 0.40% | C 0.30% | P 0.20%

GBP       CPI Y/Y Mar A 0.50% | C 0.30% | P 0.30%

GBP       Core CPI Y/Y Mar A 1.50% | C 1.30% | P 1.20%

GBP       RPI M/M Mar A 0.40% | C 0.30% | P 0.50%

GBP       RPI Y/Y Mar A 1.60% | C 1.50% | P 1.30%

GBP       PPI Input M/M Mar A 2.00% | C 2.10% | P 0.10%

GBP       PPI Input Y/Y Mar A -6.50% | C -6.20% | P -8.10% | R -8.20%

GBP       PPI Output M/M Mar A 0.30% | C 0.20% | P 0.10%

GBP       PPI Output Y/Y Mar A -0.90% | C -1.00% | P -1.10%

GBP       PPI Output Core M/M Mar A 0.10% | C 0.10% | P 0.20%

GBP       PPI Output Core Y/Y Mar A 0.20% | C 0.30% | P 0.20% | R 0.10%

USD       Import Price Index M/M Mar A 0.20% | C 1.20% | P -0.30% | R -0.40%

Good Luck,

Andy

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