Market Roundup
• US inflation pressures benign (CPI MM/SA +0.1% v 0.2% forcast), Jobless claims 253k vs 270k forcast.
• Fed’s Lacker (centrist/non-voter): open to possible April hike, Fed not behind curve on inflation, US not due for recession, sees slower US growth than he saw at beginning of year.
• Fed’s Bullard: Fed to stay exceptionally accommodative for some time, job, and inflation goals essentially met (DJ).
• China’s central bank gov: China’s corporate debt level is relatively high vs other EMs, has independent monetary policy.
• Eurogroup’s Dijsselbloem: ECB policy reaching limits need to think about exit strategy, public support for structural reforms fading.
• EU’s Moscovici: longer term economic risks lie to the downside.
Looking Ahead - Economic Data (GMT)
• --:-- China M2 Money Supply YY Mar forecast 13.5%, 13.3%- previous
• --:-- China New Yuan Loans* Mar forecast 1046.7b, 726.6b
• --:-- China Outstanding Loan Growth Mar forecast 14.5%, 14.7%- previous
• 02:00 China Urban investment (ytd)yy Mar forecast 10.3%, 10.2%- previous
• 02:00 China Industrial Output YY* Mar forecast 5.9%, 5.4%- previous
• 02:00 China Retail Sales YY* March forecast10.4%, 10.2%- previous
• 02:00 China GDP YY* Q1 forecast 6.7%, 6.8%- previous
• 02:00 China GDP QQ SA Q1 forecast 1.5%, 1.6%- previous
• 04:30 Japan Industrial Output Rev* Feb -6.2%- previous
• 04:30 Japan Capacity Utilization Index Change MM Feb 2.6%-previous
Looking Ahead - Events, Other Releases (GMT)
• 01:30 Australia- Reserve Bank of Australia financial stability review report
Currency Summaries
EUR/USD is likely to find support at 1.1200 levels and currently trading at 1.1260 levels. The pair has made session high at 1.1284 and hit lows at 1.1247 levels. The dollar weakened slightly against the euro on Thursday after data showed that U.S. consumer prices rose 0.1 percent in March, missing economists' expectations, and, suggesting the Federal Reserve will remain cautious about raising interest rates this year. The core CPI, inched up 0.1 percent. That was smallest increase since August and followed a 0.3 percent increase in February. On the other hand data showed initial claims for state unemployment benefits decreased 13,000 to a seasonally adjusted 253,000 for the week ended April 9. The euro was up 0.1 percent against the dollar at $1.1278 though way below a six-month high of $1.1464 touched on Tuesday.
GBP/USD is supported in the range of 1.4100 currently trading at 1.4154 levels. It reached session high at 1.4171 and hit low at 1.4113 levels. The British pound rose against initially dollar on Thursday after Bank of England unanimous decided to leave rates unchanged to keep interest rates steady at 0.50 percent. Immediately after the rate decision, the sterling inched higher towards 1.4178 but failed to advance further on renewed weakness and slipped back. Sterling fell back to $1.4133 by 1400 GMT, half a percent down on the day, leaving it around the level it traded at before the rate decision. Against the euro, it fell 0.5 percent on the day to 79.79 pence. Meanwhile the dollar rose 0.5 percent versus a currency basket as improved risk sentiment led investors to trim positions in low-yielding currencies, but pared gains after weaker-than-expected March U.S. consumer price data.
USD/CAD is supported at 1.2740 levels and is trading at 1.2845 levels. It has made session high at 1.2862 and lows at 1.2786 levels. The Canadian dollar weakened against US dollar on Thursday as a decline in crude oil reversed course after less-than-expected U.S. inflation data. The loonie hit a nearly nine-month high at C$1.2744 on Wednesday but recovered some ground after the Bank of Canada sounded caution on the outlook for economic growth. The central bank warned that the country's improving economy faced downside risks, including a stronger currency that could drag on non-commodity exports, although it held interest rates steady and raised growth forecasts. The currency's strongest level of the session was C$1.2782, while its weakest was C$1.2897.
AUD/USD is supported around 0.7650 levels and currently trading at 0.7694 levels. It hit session high at 0.7720 and made session lows at 0.7690 levels. The Australian dollar declined modestly against US dollar on Thursday as oil prices retreated after a choppy session as the market processed a mixed report from the International Energy Agency and skepticism that an upcoming meeting of major producers would do much to tighten the supply demand balance. Also undermining the antipodean currency was a surprise policy easing by Singapore's central bank, citing a tougher outlook for economic growth. The Australian dollar eased to $0.7645, from a high of $0.7717 on Wednesday. Support was found at $0.7596.
Equities Recap
European shares inched higher on Thursday at the end of a choppy day, with food company Nestle gaining after an encouraging earnings update and Ferrovial leading the advance on a broker's upgrade.
UK's benchmark FTSE 100 closed up 0.01 percent, the pan-European FTSEurofirst 300 ended the day up by 0.29 percent, Germany's DAX ended up by 0.63 percent, France’s CAC finished the day up by 0.47 percent.
Wall Street was little changed on Thursday after two days of solid gains as investors digested the latest round of big bank earnings.
Dow Jones closed up by 0.93 percent, S&P 500 ended up by 0.96 percent, Nasdaq finished the day up by 0.79 percent.
Treasuries Recap
U.S. benchmark Treasury debt yields rose to two-week highs on Thursday, in line with gains in crude oil futures and global stock prices ahead of an afternoon sale of 30-year government bonds.
The U.S. 10-year Treasuries were last down 6/32 in price to yield 1.78 percent. Yields earlier hit 1.804 percent, a two-week peak.
Shorter-dated maturities edged down with two-year Treasury notes flat to yield 0.762 percent.
Commodities Recap
Oil markets closed lower after a choppy session on Thursday as the market processed a mixed report from the International Energy Agency and skepticism that an upcoming meeting of major producers would do much to tighten the supply demand balance.
Brent crude futures settled down 34 cents at $43.84 a barrel while U.S. crude ended the session down 26 cents at $41.50.
Gold fell more than 1 percent on Thursday, as the dollar rose for the third day and world stocks climbed to 2016 highs, with uncertainty over the outlook for U.S.
monetary policy this year adding to volatility.
Spot gold was down 1.3 percent at $1,226.06 an ounce at 2:32 p.m. EDT (1832 GMT). U.S. gold futures for June delivery settled down 1.7 percent at $1,226.50.
