Andy Harrison

Good Morning,

LMAX Close

USDJPY 110.249 | EURUSD 1.11919 | AUDUSD 0.70114 | NZDUSD 0.65991 | USDCAD 1.34731 | USDCHF 1.01954 | GBPUSD 1.30753 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.12067 | 1.11891

USDJPY                 110.288 | 109.903

GBPUSD               1.30801 | 1.30665

USDCHF               1.01975 | 1.01856

AUDUSD              0.70268 | 0.69993

USDCAD               1.34738 | 1.34588

NZDUSD               0.66049 | 0.65251

EURCHF                1.14168 | 1.14079

EURGBP               0.85719 | 0.85609

EURJPY                 123.430 | 123.13

For Today

• GBP: A slight drift from the opening saw the market running into the upper 1.3060’s before recovering once the RBNZ was released and the market moved slowly through to the 1.3080 areas and then remained in the 1.3070-80 area through to the close. Topside , light offers through the 1.3150 area with the market likely to see increasing offers on any push through to the 1.3180-1.3200 where strong offers await, a push through the 1.3220 level is likely to see some weak stops and the market opening through to the 1.3250 areas and increasing offers thereafter, downside bids light through to the 1.3010 area with some stubborn bids into the figure before stronger bids appear on any push through to the 1.2950-00 areas with strong stops through the figure level.
• JPY: Opening around the 110.25 areas the early part of the session saw one brief movement to the 110.30 areas before starting a slow slide lower with considerable concern in the market with reminisces of 2^nd Jan equities being squeezed lower and margins starting to get squeezed, the market took its time pushing lower and after a brief flirtations with the 110.00 area broke through to the 109.90 level before moving back to hold the figure level through into the grey hour, Topside offers weak through the 111.00 areas with stronger offers likely to appear on a move beyond the 111.50-60 level into the 112.00-20 area before weak stops start to appear but strong offers from there likely to appear. Downside bids still remain through to the 109.80 area with weak stops and possibly a strong squeeze lower into the 109.50 area however, strong bids likely to be seen on any dips with yesterdays chatter of $400B of buying to move through the market over the coming months.
• AUD: Early trading saw the market drifting through the 0.7010 level before slowly rising through to the 0.7020 for the RBNZ announcement, strong selling in the NZD saw the Oz dip quickly through 0.7000 and back quickly to the 0.7020 areas and a slow range around  the level to the grey hour, Downside bids into the 0.6950 level likely to be congestive in nature with the market likely to be fairly stubborn through to the 0.6920-00 with strong bids reappearing, topside offers likely to be weak through to the 71 cents level with those offers likely to continue through to the 0.7120 level before weak stops appear and the market is free to push again towards the 72 cents levels.
• EUR: Rising from the 1.1190 level the market slowly pushed as far as the 1.1207 before running out of steam and holding in the area through to the grey hour, 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

GBP/CNY:

BoE warns how surging debt in China is putting world economy at risk

USD/CNY:

Trump vs. Xi battle has another supplier shifting from China BBG

Trade talks face moment of truth as US pushes China on subsidies

CNY/USD:

China hawks gain upper hand as Trump squeezes Beijing over trade BBG

China confident of dealing with trade talks challenges Peoples Daily

GBP:

May’s team said to be losing hope for Labour Brexit deal BBG

EUR:

EU cuts economic forecasts over trade uncertainty APW

Italy’s public finances loom into focus again Euro rates daily

NZD:

RBNZ: Rate cut necessary to support jobs, CPI target

RBNZ: A lower OCR most consistent with achieving objectives

RBNZ: Average OCR falling to 1.36% in Q3 2020

RBNZ: Lower OCR provides more balanced outlook for rates

RBNZ: Committee noted near term inflation outlook more subdued

RBNZ: Inflation expectations well anchored at target mid-point

RBNZ: Outlook for employment growth is more subdued

RBNZ Minutes: Committee reached decision to cut by consensus

RBNZ: Key downside risk was a larger than anticipated slowdown in global economic growth, particularly in China and Australia

Governor Orr: global trade remains a concern

Orr: weak inflation is global phenomenon

Orr: Cut decision wasn’t difficult

Today’s Data

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

GBP       BRC Retail Sales Monitor Y/Y Apr A 3.70% | C 2.40% | P -1.10%

JPY         BOJ Minutes Mar

JPY         Monetary Base Y/Y Apr A 3.10% | C 3.60% | P 3.80%

NZD       RBNZ Rate Decision A 1.50% | C 1.50% | P 1.75%

NZD       RBNZ Press Conference

CNY        Trade Balance (USD) Apr A 13.8B | C 33.7B | P 32.6B

CNY        Imports (USD) Y/Y Apr A 4.00% | C -2.00% | P -7.60%

CNY        Exports (USD) Y/Y Apr A -2.70% | C 3.00% | P 14.20%

CNY        Trade Balance (CNY) Apr A 94B | C 235B | P 221B

CNY        Imports Y/Y (CNY) Apr A 10.30% | C -3.00% | P -1.80%

CNY        Exports Y/Y (CNY) Apr A 3.10% | C 8.00% | P 21.30%

05:45     CHF        Unemployment Rate Apr C 2.40% | P 2.40%

06:00     EUR        German Industrial Production M/M Mar C -0.50% | P 0.70%

11:30     EUR        ECB Monetary Policy Meeting Accounts

12:15     CAD       Housing Starts Apr C 194K | P 193K

14:30     USD       Crude Oil Inventories P 9.9M

Harry Hindsight

• GBP: Opening just below the 1.3100 level the market made slow but steady headway through to 1.3125 and a long pause into the London opening, London were quick sellers as Brexit and chances of a deal disappearing once again however, one had to have a sense of humour to think the Conservatives and Labour could work with each other, dropping from the opening through to the 1.3085 area the market held for a short period of time through into the NYK  session before slowly dipping through the opening to hold the 1.3040 level and struggling through to the end of London in a tight range before recovering through to the 1.3075 areas for the close on reasonably good volumes.
• JPY: USDJPY dipped into the close and opened on the 110.60 area and that provided the base through to the London session with the USDJPY recovering in early trading through to the 110.85 area and drifting through to the grey hour back to the base line before grey hour buyers pushed it quickly to the higher again however, that was the last time it did and the move through to the NYK session, steady selling from the opening in NYK saw the market slowly make its way to the 110.20 level before holding around the level through to the close.
• AUD: A quiet rise from a lower opening saw the Oz pushing from the 0.6980 areas pushing through to the 70 cents areas and a 0.6990-0.7000 range through to the RBA release, a minor dip to the low opening level before bouncing quickly through to towards the 0.7050 areas and the high for the day, a slow steady drift then ensued with the Oz spending a long dull session drifting through to late into the NYK session testing the 70cents area before pushing through to 0.7010 area for the close.
• EUR: A slow recovery from a dip on the opening saw the Euro recovering from the 1.1190 level and push above the 1.1210 areas testing towards the 1.1220 level and holding to the London opening, a little lower than expected and dropping the market quickly back to the lows again and never really recovering with equity markets in the US getting a battering the USD kept its composure and the Euro was dipped in steps through to the London close dipping through the 1.1070 level before finding some stability and a slow climb through to the 1.1190 levels for the close.

Yesterday’s Premiership results

JPY         PMI Manufacturing Apr (F) A 50.2 | C 49.5 | P 49.5

AUD       Trade Balance (AUD) Mar A 4.95B | C 4.49B | P 4.80B | R 5.14B

AUD       Retail Sales M/M Mar A 0.30% | C 0.20% | P 0.80% | R 0.90%

NZD       RBNZ 2-Year Inflation Expectation Q2 A 2.00% | P 2.00%

AUD       RBA Rate Decision A 1.50% | C 1.25% | P 1.50%

EUR        German Factory Orders M/M Mar A 0.60% | C 1.50% | P -4.20% | R -4.00%

CHF        Foreign Currency Reserves (CHF) Apr A 772B | C 756B | P 756B

CAD       Ivey PMI Apr A 55.9 | C 51.5 | P 54.3

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