Daily FX Market Commentary

Good Morning,

LMAX Close

USDJPY 111.518 | EURUSD 1.11717 | AUDUSD 0.69994 | NZDUSD 0.66137 | USDCAD 1.34741 | USDCHF 1.01931 | GBPUSD 1.3035 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.11776 | 1.11671

USDJPY                 111.534 | 111.409

GBPUSD               1.30435 | 1.30309

USDCHF               1.02013 | 1.01919

AUDUSD              0.70007 | 0.69849

USDCAD               1.34736 | 1.34632

NZDUSD               0.66256 | 0.66085

EURCHF                1.13960 | 1.13885

EURGBP               0.85757 | 0.85682

EURJPY                 124.659 | 124.483

For Today

  • GBP: A slow grind higher despite the massive losses that the Conservative government are seeing through the local elections with the Liberal Democrats taking most of those losses with only 1/3rd counted, to be honest like the Sun newspaper states a lot of voters spoiled their election papers not only because of Brexit however, this was a foregone conclusion and Cable held through the early part of the just above the 1.3030 area and then slowly rose through the session pushing against the 1.3040 level and eventually squeezing through towards the 1.3045 level before relaxing and drifting into the grey hour around the 1.3035 areas, topside congestion through to the 1.3100 level with that congestion increasing as the market moves higher, a test through the 1.3120 areas could see weak stops appearing and the market opening only to stronger offers on any move higher with stronger offers increasing into the 1.3200 level. downside bids light through to the 1.2940 areas with stronger congestion through to the 1.2880 level with stops likely to appear if the market can gain impetus through the 1.2860 level to open a test to the stronger 1.2800 areas.
  • JPY: USDJPY limped into the Tokyo session topping just above the 111.53 area before dropping back through to the low 111.40 areas and holding for several hours after GBPJPY selling filtering through, the market saw some recovery late in the session to test to the 111.50 level before moving into the grey hour, Topside offers cleared through the 112.20 with further offers around the 112.50 level absorb the move and slow the market on any push to the 113.00 level, downside bids light through to the 111.00 area with congestion in the area and through to the 110.50 level before any weakness appears and the 110.00 becomes susceptible to a test with strong congestion on any dips.
  • AUD: More speculation about a rate cut however, one does have to point out that the mortgage lenders are independent to some extent from the RBA official cash rate so no guarantees of helping people onto the property ladder, the market opened around the 70 cents level and although throughout the session it attempted to move higher was unable to fully push through the level, the market dipped in the middle of the session into the mid 0.6980’s but again seemed to come up against sufficient buyers to hold the market before going into the grey hour just below the 70 cent level. downside stops likely on a dip through the 0.6980 area and then stronger support on a mo0ve through to the 0.6950 area possible however, the support is dated to the slow ranges from 2016 and suspect at best, with a push through the sentimental levels open until possibly stronger bids into the 68 cents area, topside offers likely to be weak through the 0.7040-60 area and increasing only on a move through the 71 cents areas and increasing from there with stronger resistance increasing the further the market moves towards the 72 cents level.
  • EUR: Barely a blip for the Euro with a meagre range through the session, and holding through to just before the grey hour around the 1.1175 level before dipping through 1.1170 lightly and early East European sellers moving in to the market. downside bids light through to the 1.1150 area where congestion increases through to the stronger supportive 1.1120-1.1080 with stops likely through the level and possibly stronger chance of a larger move, topside offer congested through the 1.1250 areas with those offers likely to increase through to the 1.1280 level and continuing through to the 1.1320 area before weakness appears for a short run into the 1.1350 areas.

 

Overnight News

USD:

US April wages likely rebounded amid tight job market – BBG

US Productivity jumps at fastest pace in four years – BBG

Moore breaks with Trump over call for rate cut before withdrawal – BBG

CNY:

Pig Ebola virus sends shock waves through global food chain – BBG

OPEC:

Iran’s oil minister warns that OPEC collapse is likely – BBG

EUR:

ECB Weidmann: Expects slowdown in German growth to be temporary

ECB Rehn: ECB should not jump the gun after the first signs of stronger data

TRY:

Erdogan reiterates determination to lower interest rates and inflation and bring FX to desired level

AUD:

Oz sees rate cut written into building approval slump

Apr Car sales down 8.9% YoY

GBP:

Current Local council results sees Conservatives nearly 225 councillors down and not even half way

Furious Brexit voters spoil ballots as Tories slump – The Sun

 

Today’s Data

Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC

AUD       AiG Performance of Service Index Apr A 46.5 | P 44.8

AUD       Building Approvals MoM Mar A -15.50% | C -12.50% | P 19.10%

0545       CHF        SECO Consumer Confidence Apr C -3 | P -4

0630       CHF        CPI MoM Apr C 0.20% | P 0.50%

0630       CHF        CPI YoY Apr C 0.70% | P 0.70%

0830       GBP       Services PMI Apr C 50.4 | P 43.9

0900       EUR        Eurozone PPI MoM Mar C 0.00% | P 0.10%

0900       EUR        Eurozone PPI YoY Mar 3.00% | P 3.00%

0900       EUR        Eurozone CPI estimate YoY Apr C 1.60% | P 1.40%

0900       EUR        Eurozone CPI Core YoY Apr (A) C 1.00% | P 0.80%

1230       USD       Advance goods trade balance Mar C 73.0B | P -70.9B

1230       USD       Wholesale inventories MoM Mar (P) C 0.20% | 0.20%

1230       USD       Change in Non-Farm payrolls Apr C 185K | P 196K

1230       USD       Unemployment rate Apr C 3.80% | P 3.80%

1230       USD       Average hourly earnings MoM Apr C 0.30 | P 0.10%

1345       USD       Services PMI Apr (F) C 52.9 | P 52.9

1400       USD       ISM Non-Manufacturing/Services composite Apr C 57 | P 56.1

 

Harry Hindsight

 

  • GBP: As you’d expect a quiet Asian session with the market moving up from the 1.3045 opening area and testing steadily through to the 1.3060 area before holding around the 1.3055 areas through to towards the grey hour where steady selling started to filter through, grey hour buying started strong push through into the London morning session with the market pushing through to the 1.3080 area before spending much of the day to NYK drifting slowly back to the opening levels for the move towards NYK, a bit jumpy around the BoE announcement with the market initially striking to the highs before dropping just as quickly back to test the 1.3025 level, the market did attempt to get back to the opening levels but struggled through the US numbers before dipping back and basing along the 1.3020 level and pushing through to a 1.3040 area for the close.
  • JPY: A slow rise through the Asian session saw the high of the day after dipping into the 111.40 area from the opening, the market ground through to deep into the Tokyo session to push into the mid 111.60 levels before drifting back and holding quietly through to the grey hours just above the 111.50 area, early London saw the market dropping back to the 111.45 level and basing through to deep into the NYK session before again dipping towards the lows only to recover from the close of London to push to a close around the 111.50 area.
  • AUD: A quiet day for the Oz or on the face of it, it would seem so however, the market having held initial pushes to the 0.7010 are then rising and holding quietly around the 0.7025 areas through to the NYK session in a quiet range, NYK saw slow but steady selling grinding to the downside bids however, event though it pushed through the 0.7000 level the market was unable to really test to far from the level.
  • EUR: A quiet range saw the market moving up from the opening level to hold just above the 1.1200 area and ranging through to the London session in the 1.1200-10 area before dipping a little through the figure on the move into the grey hour, London buying on very little to write home about numbers for the EU saw the market testing through to the 1.1220 area before holding in the Asian range through to NYK, NYK saw the Euro dipping quickly through to the 1.1180 area and a slow drift through to the close holding the 1.1170 areas.

 

Yesterday’s Premiership results

NZD       Building Permits M/M Mar A -6.90% | P 1.90% | R 1.70%

EUR        German Retail Sales M/M Mar A -0.20% | C -0.50% | P 0.90% | R 0.50%

CHF        Retail Sales Real Y/Y Mar A -0.70% | C -0.40% | P -0.20%

CHF        PMI Manufacturing Apr A 48.5 | C 51 | P 50.3

EUR        Italy Manufacturing PMI Apr A 49.1 | C 47.7 | P 47.4

EUR        France Manufacturing PMI Apr (F) A 50 | C 49.6 | P 49.6

EUR        Germany Manufacturing PMI Apr (F) 44.4 | C 44.5 | P 44.5

EUR        Eurozone Manufacturing PMI Apr (F) A 47.9 | C 47.8 | P 47.8

GBP       Construction PMI Apr A 50.5 | C 50.3 | P 49.7

GBP       BoE Rate Decision A 0.75% | C 0.75% | P 0.75%

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

GBP       MPC Official Bank Rate Votes A 0-0—9 | 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       Challenger Job Cuts Y/Y Apr A 10.90% | P 0.40%

USD       Initial Jobless Claims (APR 27) A 230K | C 220K | P 230K

USD       Nonfarm Productivity Q1 (P) A 3.60% | C 1.20% | P 1.90% | 1.30%

USD       Unit Labour Costs Q1 (P) A -0.90% | C 2.10% | P 2.00% | R 2.50%

USD       Factory Orders Mar A 1.90% | C 1.40% | P -0.50%

USD       Natural Gas Storage A 123B | C 107B | P 92B

 

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