Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 105.283 | EURUSD 1.23012 | AUDUSD 0.76924 | NZDUSD 0.7224 | USDCAD 1.29397 | USDCHF 0.94917 | GBPUSD 1.4952 |

LMAX Highs and Lows 6am GMT

                                High | Low

EURUSD               1.23416 | 1.23082

USDJPY                 105.307 | 104.637

GBPUSD               1.41232 | 1.41026

USDCHF               0.94892 | 0.94501

AUDUSD              0.77229 | 0.76872

USDCAD               1.29388 | 1.29053

NZDUSD               0.72279 | 0.72085

EURCHF                1.16812 | 1.16586

EURGBP               0.87424 | 0.87276

EURJPY                 129.620 | 128.957

For today

• EUR: Moving off a low opening and trading slowly through into the Tokyo session testing the 1.2340 level and holding the level through to the grey hours as trading quietened. Topside offers into the 1.2380-1.2400 levels with weak stops likely on a move through the 1.2420 areas with offers likely to start increasing on a move through the 1.2440 level and increasing on any approach towards the 1.2480 level, a strong push through the 1.2500 level will likely run quickly into stronger offers on any attempt towards the 1.2540 levels, downside bids light through the 1.2300 level and weak stops likely on any dip through 1.2280 however, downside bids are likely to be building on any push through the 1.2250 level and with Trumps delay on Tariffs likely to be a supportive factor through the day, stronger bids on an test of the 1.2200 level is likely to define the market for a Friday.
• GBP: Rising from the opening the market pushed back through the 1.4100 levels and trading quietly through the 1.4120 area before slipping a little lower through to the grey hours holding just above the 1.4110 area. Topside offers likely to be weak through to the 1.4200 level with possibility of people willing to fade any move above the 1.4200 levels with 1.4250 likely to be a stronger offering area however, a potential for weak stops on any break above there and the 1.4300 level likely to become a strong target for the market, downside bids light through to the 1.4040 level with weak stops on a rejection of the 1.4100 levels and opening up the potential for a quick retracement back onto the 1.39 handle and better bids into the 1.3950 areas in particular.
• JPY: The release of the McMaster story saw the USDJPY drop quickly from the opening around the 105.30 levels and testing quickly through to the 104.60 level the market bounced slightly but struggled on the move back through the 105 level testing to the 105.10 area and then slowly ranging lower centred around the 104.80 levels into the grey hours, Downside bids into the 104.50 level and likely to continue lightly through to the 104.00 level, some possibility of option interest through the level but not likely to be particularly strong and the market seeing possibly stronger sentimental buyers, a push through the 104.00 level will quickly find the market targeting the stronger 103.50 areas with better bids. Topside offers through the 106.00 level are possibly now increasing in size with weak stops on any move through the 106.20 areas and the market potentially facing a short squeeze higher through to the 107.00 level
• AUD: With USD weakness filtering through in early trading the market slowly moved off the lows around the 0.7690 areas to push slowly through into the Tokyo session rising through to mid-session probing the 0.7720 level, the market then drifted back a little to hold through to the grey hours around the 0.7710 area, overall decent volumes through the session across all pairings. Congestive bids through the 76 cent handle and likely limited stops on any push through the 0.7650 areas and into the stronger 0.7620-00 levels with the ranges from 2017 likely to limit any quick moves lower however, once through to that level the market is likely to find more selling appearing. Topside offers light through to the 0.7780 levels where stronger offers are likely to appear and only a strong push through the 0.7840-60 level will reverse the pressure.

Overnight News

SEK:

Riksbank’s Jansson Deputy Gov. Comments in op-ed

Jansson says SEK not in downward trend

Jansson says SEK relatively weak now, won’t stay that way

Jansson expects SEK to gradually strengthen

USD:

Trump has fired National Security Adviser H.R. McMaster

Trump temporarily exempts tariffs on EU, Australia, Korea and Brazil until May

JPY:

Trade war to keep Japanese bond investors at home Nissay asset management corp says

Today’s data

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

JPY         National CPI Core Y/Y Feb A 1.00% | C 1.00% | P 0.90%

12:00     GBP       BoE Quarterly Bulletin

12:30     CAD       CPI M/M Feb C 0.50% | P 0.70%

12:30     CAD       CPI Y/Y Feb C 2.00% | P 1.70%

12:30     CAD       CPI Core Common Y/Y Feb C 1.90% | P 1.80%

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

12:30     CAD       CPI Core – Trim Y/Y Feb P 1.80%

12:30     CAD       Retail Sales M/M Jan C 1.20% | P -0.80%

12:30     CAD       Retail Sales Ex Auto M/M Jan C 0.90% | P -1.80%

12:30     USD       Durable Goods Orders Feb (P) C 1.70% | P -3.60%

12:30     USD       Durables Ex Transportation Feb (P) C 0.50% | P -0.30%

14:00     USD       New Home Sales Feb C 621K | P 593K

 

Harry Hindsight

• EUR: Decent volume through the day with the early market rising quickly on the opening in Tokyo to test to the 1.2370 levels and then holding through too late in the session dropping back a little into the grey hours to push into the 1.2345 areas, the move through to early London saw the market rise quickly through to the 1.2385 level before starting a steady decline through the London opening and into early morning pushing back through to the 1.2310 level with poor PMI numbers across the board, the market drifted through deep into the NYK session probing a little below the 1.2300 areas and basing close to the level for the run to the close.
• GBP: Rising from the opening in Tokyo the market pushed through to the 1.4165 levels holding those early highs through to the run into the grey hours, the market drifted back to the 1.4145 levels and then dipped further on the European numbers, the rate decision saw the market moving off the 1.4150 level and pushing quickly through to the 1.4220 on a spike triggered by weak stops before dropping quickly lower and pushing through to the 1.4100 from the NYK opening with the 2 votes for a rise causing the initial move, and less than bullish commentary leaving the market weakened and dipping back to the 1.4075 levels before ranging just above the 1.4100 levels through to the close.
• JPY: USDJPY continued to drift lower through the session with the market dropping back from the opening 106.05 areas testing the 105.60 areas in early Tokyo and then slowly rising towards the 105.90 levels into the grey hours, London was a slow seller through the session and the move into the NYK session saw the market slipping through London’s 105.55 level low to test the 105.30 area, the market then struggled through the session lifting to the 105.75 areas into the London close and then declining steadily back to the lows for the move into the close.
• AUD: Oz made early highs into the Tokyo session testing the 0.7785 levels before dropping back on the release of the unemployment data and slipping through the session to hold into the grey hours around the 0.7740 levels, London bought the market lightly through to the 0.7765 level and market then dropped back quickly after the Eurozone numbers moved through the market holding the 0.7725 level to the NYK session, NYK were slow sellers with the market slowly slipping through to the 0.7890 areas finding a little support and the market bouncing off the level eventually, but unable to push back through the 0.7725 area slowly drifted back to the lows for the close.

Yesterday’s premiership results

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

AUD       Employment Change Feb A 17.5K | C 20.3K | P 16.0K | R 12.5K

AUD       Unemployment Rate Feb A 5.60% | C 5.50% | P 5.50%

JPY         PMI Manufacturing Mar (P) A 53.2 | C 54.3 | P 54.1

JPY         All Industry Activity Index M/M Jan A -1.80% | C -1.80% | P 0.50% | R 0.60%

EUR        France Manufacturing PMI Mar (P) A 54.2 | C 55.5 | P 55.9

EUR        France Services PMI Mar (P) A 56.8 | C 57 | P 57.4

EUR        Germany Manufacturing PMI Mar (P) A 58.4 | C 59.8 | P 60.6

EUR        Germany Services PMI Mar (P) A 54.2 | C 55 | P 55.3

EUR        Eurozone Manufacturing PMI Mar (P) A 56.6 | C 58.1 | P 58.6

EUR        Eurozone Services PMI Mar (P) A 55 | C 56 | P 56.2

EUR        Eurozone Current Account (EUR) Jan A 37.6B | C 30.2B | P 29.9B | R 31.0B

EUR        German IFO Business Climate Mar A 114.7 | C 114.6 | P 115.4

EUR        German IFO Expectations Mar A 104.4 | C 104.4 | P 105.4

EUR        German IFO Current Assessment Mar A 125.9 | C 125.6 | P 126.3

EUR        ECB Economic Bulletin

GBP       Retail Sales M/M Feb A 0.80% | C 0.40% | P 0.10% | R -0.20%

GBP       BoE Rate Decision A 0.50% | C 0.50% | P 0.50%

GBP       BoE Asset Purchase Target Mar A 435B | C 435B | P 435B

GBP       MPC Official Bank Rate Votes A 2–0—7 | C 0–0—9 | P 0–0–9

GBP       MPC Asset Purchase Facility Votes A 0–0—9 | C 0–0—9 | P 0–0–9

USD       Initial Jobless Claims (MAR 17) A 229K | C 225K | P 226K

USD       House Price Index M/M Jan A 0.80% | C 0.40% | P 0.30% | R 0.40%

USD       US Manufacturing PMI Mar (P) A 55.7 | C 55.5 | P 55.3

USD       US Services PMI Mar (P) A 54.1 | C 56 | P 55.9

USD       Leading Index Feb A 0.60% | C 0.50% | P 1.00%

USD       Natural Gas Storage A -86B | C -88B | P -93B

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