Market Roundup
- U.S., China resume trade talks in Beijing after 'productive working dinner'
- UK PM May plans watered-down Brexit vote to secure departure delay
- UK consumers hold their nerve in Brexit storm: GfK
- New Zealand central bank governor says markets understand its focus
- Japan Feb Industrial Output Prelim MM SA, 1.4%, 1.0% f'cast, -3.4% prev
- Japan Feb Retail Sales YY, 0.4%, 1.2% f'cast, 0.6% prev
- U.S. muni bond funds post $1.5 bln in inflows-Lipper
- NY Investors pull US$1.36bn from loan funds - Lipper
- Foreign CB US debt holdings -$9.287 bln to $3.470 tln Mar 27 week
- Treasuries -$10.848 bln to $3.071 tln, agencies +$614 mln to $325.925 bln
Economic Data Ahead
- (0300 ET/0700 GMT) Germany Feb Import Prices YY, 1.8% f'cast, 0.8% prev
- (0300 ET/0700 GMT) Germany Feb Retail Sales YY Real, 2.8% f'cast, 2.6% prev
- (0300 ET/0700 GMT) Great Britain Mar Nationwide house price yy, 0.6% f'cast, 0.4% prev
- (0345 ET/0745 GMT) France Mar CPI (EU Norm) Prelim YY, 1.4% f'cast, 1.6% prev
- (0455 ET/0855 GMT) Germany Mar Unemployment Chg SA, -10k f'cast, -21k prev
- (0455 ET/0855 GMT) Germany Mar Unemployment Rate SA, 4.9% f'cast, 5.0% prev
- (0530 ET/0930 GMT) Great Britain Q4 GDP QQ 0.2% f'cast, 0.2% prev
- (0530 ET/0930 GMT) Great Britain Q4 GDP QQ 1.3% f'cast, 1.3% prev
Key Events Ahead
- N/A Bank of Italy Governor presents his "Final Considerations" on the occasion of the presentation of 2018 annual report in Rome
- (0545 ET/0945 GMT) ECB board member Benoit Coeure participates in a panel discussion in Paris, France
- (0925 ET/1325 GMT) Federal Reserve Bank of New York President John Williams speaks in St. Thomas, Virgin Islands
- (0930 ET/1330 GMT) Norwegian Finance Minister Siv Jensen speaks at a seminar in Oslo organised by World Economic Forum
- (1030 ET/1430 GMT) Federal Reserve Bank of Dallas President Robert Kaplan participates in a moderated Q&A session in New York
- (1205 ET/1605 GMT) Federal Reserve Vice Chair Randal Quarles speaks at the Manhattan Institute's Shadow Open Market Committee's Spring 2019 Meeting in New York
FX Beat
DXY: The dollar index held firm near a 3-week peak, as the 10-year U.S. bond yield edged up to 2.403 percent from a 15-month low of 2.352 percent touched on Thursday. The greenback against a basket of currencies traded flat at 97.17, having touched a peak of 97.30 the day before, its highest since Mar. 11. FxWirePro's Hourly Dollar Strength Index stood at 89.47 (Slightly Bullish) by 0500 GMT.
EUR/USD: The euro rebounded after falling to a 3-week low in the previous session in the wake of sliding yields and fears of a prolonged economic slowdown hitting the eurozone. However, the upside in the major appears limited amid speculation the European Central Bank will introduce a tiered deposit rate, providing a sign that policymakers plan to keep interest rates low for longer. The European currency traded 0.2 percent up at 1.1234, having touched a low of 1.1213 on Thursday, its lowest since Mar. 8. FxWirePro's Hourly Euro Strength Index stood at -42.22 (Neutral) by 0500 GMT. Investors’ attention will remain on a series of data from the Eurozone economies, including German retail sales and unemployment rate, ahead of the U.S. personal consumption expenditures, new home sales and Fed officials' speech. Immediate resistance is located at 1.1285 (Mar. 28 High), a break above targets 1.1359 (Mar. 18 High). On the downside, support is seen at 1.1200, a break below could drag it till 1.1176 (Mar. 7 Low).
USD/JPY: The dollar rallied to a 1-week peak after data released yesterday showed U.S. gross domestic product increased at a 2.2 percent annualised rate. Moreover, news that U.S.-China resumed trade talks in Beijing aimed at resolving the trade dispute between both the economies boosted investor sentiment. The major was trading 0.1 percent up at 110.78, having hit a high of 110.93 earlier, its highest since Mar. 21. FxWirePro's Hourly Yen Strength Index stood at -16.37 (Neutral) by 0500 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. personal consumption expenditures, new home sales and Fed officials' speech. Immediate resistance is located at 111.23 (Feb. 25 High), a break above targets 111.46 (Mar. 12 High). On the downside, support is seen at 109.91 (Mar. 26 Low), a break below could take it lower at 109.55 (Feb. 6 Low).
GBP/USD: Sterling rose after declining to a 1-week low in the previous session on fading prospects for a swift agreement on Brexit as the British parliament failed to agree on a way forward. The major traded 0.2 percent up at 1.3066, having hit a low of 1.3034 on Thursday; it’s lowest since Mar. 21. FxWirePro's Hourly Sterling Strength Index stood at -20.40 (Neutral) 0500 GMT. Immediate resistance is located at 1.3109 (Feb. 20 High), a break above could take it near 1.3160 (Jan. 31 High). On the downside, support is seen at 1.3003 (Mar. 21 Low), a break below targets 1.2960 (Mar. 11 Low). Against the euro, the pound was trading 0.1 percent up at 85.96 pence, having hit a high of 84.83 Wednesday, it’s highest since Mar. 13.
AUD/USD: The Australian dollar surged, despite speculation the Reserve Bank of Australia would have to ease policy this year, if only to stop its currency from appreciating. The major trades 0.3 percent up at 0.7096, having hit a high of 0.7168 last week, it’s highest since Feb. 27. FxWirePro's Hourly Aussie Strength Index stood at 33.08 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7041 (Mar. 14 Low), a break below targets 0.7003 (Mar. 8 Low). On the upside, resistance is located at 0.7149 (Mar. 20 High), a break above could take it near 0.7198 (Feb. 27 High).
NZD/USD: The New Zealand dollar steadied after Reserve Bank of New Zealand Governor Adrian Orr stated that investors reaction to the central bank's unexpected shift to an easing bias this week showed that they understood what policymakers were focused on. The Kiwi trades 0.3 percent up at 0.6798, having touched a low of 0.6773 earlier, its lowest level Mar. 8. FxWirePro's Hourly Kiwi Strength Index was at -75.60 (Slightly Bearish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6853 (Feb. 22 High), a break above could take it near 0.6944 (Dec. 5 High). On the downside, support is seen at 0.6768 (Mar. 5 Low), a break below could drag it below 0.6744 (Mar. 7 Low).
Equities Recap
Asian shares climbed on hopes that Washington and Beijing are making progress in trade talks.
MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.5 percent.
Tokyo's Nikkei rallied 0.8 percent to 21,205.81 points, Australia's S&P/ASX 200 index gained 0.1 percent to 6,180.70 points and South Korea's KOSPI rose 0.6 percent to 2,140.41 points.
Shanghai composite index surged 3.1 percent to 3,087.80 points, while CSI300 index traded 3.8 percent up at 3,869.86 points.
Hong Kong’s Hang Seng traded 0.9 percent higher at 29,051.44 points. Taiwan shares added 0.9 percent to 10,641.04 points
Commodities Recap
Crude oil prices declined, despite ongoing supply cuts led by producer cartel OPEC and U.S. sanctions against Iran and Venezuela. International benchmark Brent crude was trading 0.9 percent down at $67.39 per barrel by 0525 GMT, having hit a high of $68.33 on Wednesday, its highest since Mar. 21. U.S. West Texas Intermediate was trading 0.2 percent higher at $59.60 a barrel, after rising as high as $60.37 last week, its highest since the Nov. 12.
Gold prices plunged to a 3-week low and were on track for its first weekly decline in four weeks after posting its steepest fall in more than seven months in the prior session on a strong greenback. Spot gold eased 0.1 percent to $1,289.50 per ounce by 0528 GMT, having touched a low of $1,288.31, its lowest since March 8 and is down about 1.6 percent so far this week. U.S. gold futures were flat at $1,290 an ounce.
Treasuries Recap
The yield on Australia’s benchmark 10-year note, which moves inversely to its price, surged 4-1/2 basis points to 1.771 percent, the yield on the long-term 30-year bond climbed 3 basis points to 2.406 percent and the yield on short-term 2-year traded tad higher at 1.456 percent.
The Canadian government bond prices were lower across the yield curve in sympathy with U.S. Treasuries. The two-year fell 6.5 Canadian cents to yield 1.493 percent and the 10-year declined 21 Canadian cents to yield 1.556 percent. On Wednesday, the 10-year yield hit its lowest intraday since June 2017 at 1.508 percent
