Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 110.934 | EURUSD 1.05954 | AUDUSD 0.75015 | NZDUSD 0.69597 | USDCAD 1.33263 | USDCHF 1.00851 | GBPUSD 1.24160 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.06020 | 1.05808

USDJPY                 110.882 | 110.584

GBPUSD               1.24329 | 1.24115

USDCHF               1.00939 | 1.00772

AUDUSD              0.75133 | 0.74943

USDCAD               1.33333 | 1.33143

NZDUSD               0.69695 | 0.69415

EURCHF                1.06852 | 1.06795

EURGBP               0.85342 | 0.85176

EURJPY                 117.463 | 117.07

For Today

• EUR: The market pushed a little higher from the opening trading lightly through the 1.0600 areas before dropping back through the session to the 1.0580 areas to hold around the 1.0585 level to the grey hour, topside light offers through the 1.0620 areas with possible weak stops through the level and stronger congestion through the 1.0650 areas, stronger offers likely into the 1.0700-20 areas with limited upside stops. Downside bids into the 1.0550 levels possibly light with stronger bids likely into the 1.0500 areas and weak stops on a move through the 1.0480 areas and limited bids through to the 1.0460 level.
• GBP: A very quiet range for Cable with the market rising to test above the 1.2430 areas but generally trading around the 1.2420 levels through to the grey hour, Topside offers into the 1.2450 levels are likely to be light with stronger offers likely to move in around the 1.2500 areas and strong congestive offers on a move through to the 1.2550 levels, a break here is likely to see some weak stops and the market vulnerable to a test to the 1.2600 areas, Downside bids into the 1.2350 area are likely to be reasonable with weak stops on a move through the level and limited bids into the 1.2300 areas.
• JPY: Moving from the 110.90 areas the market dipped into the Tokyo session testing through to the 110.70 areas and then ranging through the session between the 110.80-60 levels into the grey hours and the market running along those lows. Downside congestive bids into the 110.50 areas before stronger bids through to the 110.20-00 areas, strong stops likely through the level and the market opening to a deeper move lower. Topside offers light through the 111.00 areas and increasing into the 111.30-50 areas with possible weak stops through the level and stronger offers coming in around the 112.00 areas.
• AUD: Early gains saw the market pushing through towards the 0.7515 areas before holding for aq period around the 0.7510 before drifting back to trade around the 75 cent levels making lows just through the 0.7495 areas. Topside offers into the 0.7530 areas with stops likely on a move through however, they are likely to be light with some congestive offers into the 0.7540-60 areas and stronger offers into the 0.7580-0.7600 levels. Downside bids into the 0.7480 areas with light bids into the 0.7450-60 areas, stronger stops likely on a move through the 0.7440 and limited bids into the 74 cent areas.

Overnight News

USD:

Fed Chair Janet Yellen speaks at University of Michigan event

Yellen: Fed designed to be nonpartisan

Yellen: Crisis taught importance of financial stability

Yellen: Global economy is operating in more robust way

Yellen: we’re close to reaching our objectives

Yellen: Appropriate to gradually raise Fed funds rate

Yellen: Gradual pace of hikes can get Fed to neutral stance

Yellen: Behaviour of inflation has changed in recent years

Yellen: we’re focused on anchoring inflation and expectations

JPY:

BoJ’s Kuroda expresses confidence in ability to exit quantitative easing policy

EUR/USD:

US Takes down huge botnet as Spain arrests notorious Russian hacker

IMF:

More upbeat about global economy this year than 2016

CNY:

China deploys 150,000 troops to deal with possible N.Korean refugees

GBP:

BRC Retail sales numbers again dropped

Today’s data

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

GBP       BRC Retail Sales Monitor Y/Y Mar A -1.00% | C -0.50% | P -0.40%

AUD       NAB Business Confidence Mar A 6 | P 7

06:00     JPY         Machine Tool Orders Y/Y Mar (P) P 9.10%

08:30     GBP       CPI M/M Mar C                 0.30% | P 0.70%

08:30     GBP       CPI Y/Y Mar C 2.30% | P 2.30%

08:30     GBP       Core CPI Y/Y Mar C 1.90% | P 2.00%

08:30     GBP       RPI M/M Mar C 0.40% | P 1.10%

08:30     GBP       RPI Y/Y Mar C 3.20% | P 3.20%

08:30     GBP       PPI Input M/M Mar C -0.10% | P -0.40%

08:30     GBP       PPI Input Y/Y Mar C 17.00% | P 19.10%

08:30     GBP       PPI Output M/M Mar C 0.10% | P 0.20%

08:30     GBP       PPI Output Y/Y Mar C 3.40% | P 3.70%

08:30     GBP       PPI Output Core M/M Mar C 0.20% | P 0.00%

08:30     GBP       PPI Output Core Y/Y Mar C 2.50% | P 2.40%

08:30     GBP       House Price Index Y/Y Feb C 6.10% | P 6.20%

09:00     EUR        Eurozone Industrial Production M/M Feb C 0.10% | P 0.90%

09:00     EUR        German ZEW (Economic Sentiment) Apr C 14.8 | P 12.8

09:00     EUR        German ZEW (Current Situation) Apr C 77.5 | P 77.3

09:00     EUR        Eurozone ZEW (Economic Sentiment) Apr C 25 | P 25.6

 

Harry Hindsight

• EUR: Overall a quiet session with the range limited, the market opened only slightly lower and moved through to the Tokyo session pushing down through the 1.0575 levels before finding some support, the market continued to trade around the level deep into the session eventually pushing to the 1.0570 level for the first time, the move through into the London session saw the market recovering to the opening level, from the opening though the market steadily slipped lower trading again to the 105.70 level for the second time and the move into NYK saw the market steadily rising through to the 1.0605 areas with the market thereafter ranged around the 1.0600 levels through to the close.
• GBP: Opening a little higher around the 1.2380 level with the market dipping back to fill the gap on the charts and test into the Tokyo opening with the market testing below the 1.2370 area, that was the low for the day with the market heading steadily higher through the day, the move into the London session saw the market pushing around the 1.2390 areas and continuing through to range around the 1.2400 areas into the NYK session lifting through to test towards the 1.2430 areas and ranging through to the close around the 1.2420 level.
• JPY: Slightly larger range for the USDJPY with the market opening just above the 111.00 and testing into the early Tokyo session to the 111.55 areas before sliding through the balance of the day as the USD lost ground against most currencies with Syria and N.Korea causing concerns for the USD, commentary by Bullard undercut the USD a little however, we have seen various comments through the days for and against more rises which would explain the lack of interest for the moment, the move through into the NYK session saw the market dip into the 111.20 levels and the close of London saw a larger drop through to the 110.80 areas before holding that low and trading around the 111.00 areas to the close.
• AUD: A very quiet range for the Oz with the market opening around the 0.7495 levels and rising quietly through to the 0.7508 areas before falling back on a negative home loans number, the market dropped into the high 0.7470’s before moving into the London session again testing those lows, the move through the balance of the session saw the market creep back to the opening levels and hold through to the close around the 75 cent level in a very quiet session.

Yesterday’s premiership results

JPY       Current Account (JPY) Feb A 2.21T | C 1.79T | P 1.26T

AUD     Home Loans Feb A -0.50% | C 0.00% | P 0.50% | R 0.40%

JPY       Eco Watchers Survey Current Mar A 47.4 | C 49.8 | P 48.6

EUR      Eurozone Sentix Investor Confidence Apr A 23.9 | C 21 | P 20.7

CAD      Housing Starts Mar A 254K | C 215.5K | P 210.2K | R 214K

USD      Labour Market Conditions Index Change Mar A 0.4 | P 1.3 | R 1.5

Good Luck,

Andy

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