Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 110.932 | EURUSD 1.07839 | AUDUSD 0.76273| NZDUSD 0.70347 | USDCAD 1.33513 | USDCHF 0.99331 | GBPUSD 1.25206 |

LMAX Highs and Lows 6am GMT

                                High | Low

EURUSD               1.07857 | 1.07604

USDJPY                 111.479 | 110.912

GBPUSD               1.25202 | 1.24769

USDCHF               0.99597 | 0.99296

AUDUSD              0.76406 | 0.76104

USDCAD               1.33777 | 1.33472

NZDUSD               0.70352 | 0.70026

EURCHF                1.07197 | 1.07049

EURGBP               0.86287 | 0.86115

EURJPY                 120.044 | 119.602

For Today

• EUR: Opening around the 1.0785 ares the market moved quietly through to the Tokyo opening and then slipped quickly lower as the USD started a little recoverly with Feds John Williams made comments on 3 hikes maybe more, Euros moved quickly through the 1.0775 areas and eventually started to trade around the 1.0765 areas with the lows close to 1.0760 area for the move into the grey hours. Topside offers through the 1.0800 levels with weak stops likely through the 1.0830 area, however, the offers are likely to be strong again, a move through the 1.0860 areas is likely to see the market testing towards the 1.0900 areas with reasonable offers in the area. Downside bids light through to the 1.0720 areas with stronger bids through that level and weak stops on a move through the 1.0680 areas and the better bids likely into the 1.0640-60 areas.
• GBP: Cable slipped from the opening levels around the 1.2520 areas testing quickly through the 1.2500 areas triggering weak stops and pushing to base along the 1.2480 areas through to the grey hours with very little for the day, Topside offers congestive through the 1.2500 levels with 1.2550 likely to be a strong level and the 1.2600 level becoming vulnerable quickly, with some congestion from then on. Downside bids light through to the 1.2400 areas with the market likely to see some support appearing with weak stops likely through the area and stronger bids into the 1.2350-00 areas.
• JPY: Having opened almost at its lows the market eased into the Tokyo session extending just slightly through the open 110.90 areas before moving quickly on the Tokyo opening as the Williams comments hit the wires and the market moved quickly through to the 111.20 level and then gradually pushing above the 111.40 level, the market then traded around the 111.30 levels through to the close with the highs tested as the market approaches the grey hours.
• AUD: A slightly stronger USD on the back of the Williams comments were slow to filter through into the Oz with the initial USD buying absorbed by AUDJPY buying as the JPY weakened however, after several hours of trading the Oz dipped from the 0.7640 area highs back through the opening levels to test the 0.7610 areas and then range through to the grey hours broadly trading the 0.7610-20 areas. Downside bids into the 76 cent levels with possibly strong bids into the area and any weak stops likely to be absorbed by congestion on the move through the level with bids all the way through to the 75 cent in patches concentrated around the 0.7580, 60, 40, 20 before strongest into the 75 cent level, a push through the level will likely see fresh bids moving in around the 0.7460 areas but possibly contained in a tight range again, Topside offers through to the 77 cent level likely to be limited however, through that level the offers are likely to be stacked up again and strongest into the 0.7750 areas with weak stops likely through the level.

Overnight News

GBP:

BOE’s Vlieghe Says Inflation Doesn’t Mean Rate Increase: Times

USD:

Fed’s Kaplan Says Three 2017 Rate Increases Reasonable Baseline

House GOP Leaders Plan Friday Vote on Amended Health Bill

Fed’s Kaplan: We’re Approaching Time to Allow B/Sheet to Run Off

Fed’s Kaplan: Inflation Nearing 2%, Full Employment Is Closer

USD/CNY:

Former USTR Says Worst Case Is ‘Tit-For-Tat’ China Trade War

JPY:

Japan PM Abe denies he or wife made donations to principal of scandal-hit school

Japanese Bought Net 149.4 Billion Yen Overseas Debt Last Week

Kuroda: Can Have Same Impact on Yield with Smaller JGB Purchases

Nikkei Japan March Flash Manufacturing PMI 52.6 vs 53.3 in Feb.

CNY:

China to Promote Economic Globalization, Free trade: Vice Premier

China Has No Intention to Militarize South China Sea, Li Says

KRW/CNY:

1. Korea to Take Legal Action if China Violated Trade Rules: Yoo

SGD:

Singapore February Factory Output +12.6% Y/y; Est. +10%

NZD:

New Zealand Posts Widest Annual Trade Deficit in Almost 8 Years

N.Z. February New Residential Mortgage Lending Falls 15%: RBNZ

Fonterra Says N.Z. Milk Collection Fell 2.2% from Year Ago

EUR:

Hollande: Was Informed by Press Over ‘Serious’ Fillon Issues

Today’s data

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

NZD       Trade Balance (NZD) Feb A -18M | C 160M | P -285M | R -257M

NZD       Exports (New Zealand dollars) Feb A 4.01B | C 4.20B | P 3.91B

JPY         PMI Manufacturing Mar (P) A 52.6 | C 53.5 | P 53.3

08:00     EUR        France Manufacturing PMI Mar (P) C 52.4 | P 52.2

08:00     EUR        France Services PMI Mar (P) C 56.1 | P 56.4

08:30     EUR        Germany Manufacturing PMI Mar (P) C 56.5 | P 56.8

08:30     EUR        Germany Services PMI Mar (P) C 54.5 | P 54.4

09:00     EUR        Eurozone Manufacturing PMI Mar (P) C 55.3 | P 55.4

09:00     EUR        Eurozone Services PMI Mar (P) C 55.3 | P 55.5

09:30     GBP       BBA Mortgage Approvals Feb C 44.9K | P 44.7K

12:30     CAD       CPI M/M Feb C 0.20% | P 0.90%

12:30     CAD       CPI Y/Y Feb C 2.10% | P 2.10%

12:30     CAD       CPI Core- Common Y/Y Feb P 1.30%

12:30     CAD       CPI Core- Median Y/Y Feb P 1.90%

12:30     CAD       CPI Core- Trim Y/Y Feb P 1.70%

12:30     USD       Durable Goods Orders Feb (P) C 1.20% | P 2.00%

12:30     USD       Durables Ex Transportation Feb (P) C 0.70% | P 0.00%

Harry Hindsight

• EUR: A quiet day for the Euro with the market slipping lower through the day, opening just below the 1.0800 areas the market slipped slowly lower into the Tokyo opening and continuing through to range around the 1.0785 for a few hours before bouncing back higher as the market moved into the last few hours and holding around the opening levels, grey hours saw quick buying moving in from Eastern Europeans testing to the 1.0805 levels before slipping slowly back as the market drifted into London testing the lows and eventually breaking through to trigger some weak stops on a move to the 1.0770 areas, with weaker consumer confidence, ECB bulletin did little for the market however, it did move back towards the opening levels before ranging through to the close in an ever tightening range.
• GBP: Opening around the 1.2485 levels the market initially settled back to trade around the 1.2470 areas before recovering and moving through into the grey hours pushing back above the opening, grey hours buying took the market higher testing to the 1.2515 levels before dropping quickly back again as the early London with weak stops pushing through into the London opening, to test to the 1.2465 areas, the market nervous about the retail sales numbers one assumes however, the market gapped quickly higher on a very good number with the market pushing towards the 1.2530 areas before trading through into NYK 1.2500 levels, NYK were steady buyers and tested the highs again and ranging quietly above the 1.2510 levels through to the close.
• JPY: Early gains saw the USD wane through into the NYK session, opening around the 111.20 levels the early move higher through into Tokyo saw the market testing towards the 111.60 areas before starting a slow drift to the grey hours dipping down towards the 111.30 level and the London session saw steady USD selling through to the NYK session with the market pushing down through the 110.90 areas and a quick trip to the 110.60’s before NYK reversing the move on initial jobless claims only just missing consensus and the move through to the London close testing back to the opening levels, then slipping back to range around the 111.00 to the close.
• AUD: A very quiet day for the Oz with the market slipping from the 0.7675 area opening into the Tokyo session testing towards the 0.7650 areas, the move into the London session saw some weak stops triggered and slipping down to trade around the 0.7630 areas through to the close with the market dipping into the low 0.7620’s to make the lows.

Yesterday’s premiership results

NZD       RBNZ Rate Decision A 1.75% | C 1.75% | P 1.75%

EUR        German GfK Consumer Confidence Apr A 9.8 | C 10 | P 10

EUR        ECB Economic Bulletin

GBP       Retail Sales M/M Feb A 1.40% | C 0.40% | P -0.30% | R -0.50%

GBP       CBI Retailing Reported Sales Mar A 9 | C 4 | P 9

USD       Initial Jobless Claims (MAR 18) A 258K | C 240K | P 241K | R 243K

USD       New Home Sales Feb A 592K | C 566K | P 555K | R 558K

USD       Natural Gas Storage A -150B | C -147B | P -53B

EUR        Eurozone Consumer Confidence Mar A -5 | C -5.8 | P -6.2

Good Luck,

Andy

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