Market Roundup
• Canada GDP (QoQ) (Q1) 0.4% ,0.2% previous
•Canada GDP Annualized (QoQ) (Q1) 1.7% , 2.2% forecast, 1.0% previous
• Canada GDP Implicit Price (QoQ) (Q1) -0.30% ,1.40% previous
• US Apr Personal Income (MoM) 0.3%, 0.3% forecast, 0.5% previous
• US Apr Real Personal Consumption (MoM) -0.1% ,0.5% previous
• US Apr Personal Spending (MoM) 0.2% ,0.3% forecast, 0.8% previous
• US Apr PCE Price index (YoY) 2.7% ,2.7% forecast, 2.7% previous
• US Apr PCE price index (MoM) 0.2% ,0.3% forecast, 0.3% previous
• US Apr Core PCE Price Index (MoM 0.3% ,0.3% forecast, 0.3% previous
• Canada GDP (YoY) (Q1) 0.53% ,0.93% previous
• US Apr Core PCE Price Index (YoY) 2.8%, 2.8%forecast, 2.8% previous
• Canada Mar GDP (MoM) 0.0%, 0.0% forecast, 0.2% previous
•US Apr Dallas Fed PCE 2.70% ,2.90% previous
•US May Chicago PMI 35.4, 41.1 forecast, 37.9 previous
•US Atlanta Fed GDPNow (Q2) 2.7% ,3.5% forecast, 3.5% previous
•Canada Mar Budget Balance (YoY) -50.93B ,-25.70B previous
•U.S. Baker Hughes Oil Rig Count 496 ,497 previous
•U.S. Baker Hughes Total Rig Count 600 ,600 previous
Looking Ahead Economic Data(GMT)
•No Data Ahead
Looking Ahead Events And Other Releases(GMT)
•No Events Ahead
Currency Summaries
EUR/USD: The euro strengthened on Friday after data showed price pressures in the euro zone picked up faster than expected in May, complicating the outlook for the European Central Bank.Euro zone inflation rose in May, data showed on Friday, in a sign the European Central Bank still faces a slow and uncertain journey to reach its goal of fully reining in prices. The bigger-than-expected increase in inflation was unlikely to stop the ECB from lowering borrowing costs from a record high next week, but may cement the case for a pause in July and a slower pace of interest rate reductions in the coming months. The euro was up 0.13% to $1.0847. Immediate resistance can be seen at 1.0878(23.6%fib), an upside break can trigger rise towards 1.0908(Higher BB).On the downside, immediate support is seen at 1.0798 (38.2% fib), a break below could take the pair towards 1.0739(50% fib).
GBP/USD: Sterling initially gained but gave up ground on Friday after data showed a modest rise in U.S. inflation in April offered investors little clarity on the Federal Reserve's interest-rate policy.The U.S. Commerce Department said the personal consumption expenditures (PCE) price index, widely seen as the Fed's favoured inflation indicator, increased 0.3% last month, in line with expectations and the March increase, while core PCE rose 0.2%, compared with 0.3% in March. The Fed has raised borrowing costs by 525 basis points since March 2022 in a bid to cool demand across the economy. Financial markets initially expected the first rate cut to come in March, but it then got pushed to June and now to September .Immediate resistance can be seen at 1.2778(23.6%fib), an upside break can trigger rise towards 1.2817(Higher BB).On the downside, immediate support is seen at 1.2683(38.2%fib), a break below could take the pair towards 1.2621(50% fib).
USD/CAD: The Canadian dollar rose against its U.S. counterpart on Friday as a drop in U.S. bond yields offset increased bets the Bank of Canada would begin cutting interest rates next week following the release of weaker-than-expected Canadian GDP data. The Canadian economy expanded at a slower-than-expected annualized rate of 1.7% in the first quarter, while the pace of fourth-quarter growth was revised to 0.1% from 1.0% reported initially.Chances that the BoC would lower its benchmark interest rate from the current level of 5% at a policy decision on June 5 climbed to 80% from 66% before the GDP report, swaps market data showed.The loonie was 0.3% higher at 1.3640 to the U.S. dollar, or 73.31 U.S. cents, after trading in a range of 1.3620 to 1.3689. For the week, the currency was up 0.2%. Immediate resistance can be seen at 1.4071 (Daily high), an upside break can trigger rise towards 1.4170 (May 7th high).On the downside, immediate support is seen at 1.4042 (21 DMA), a break below could take the pair towards 1.3971(55 DMA).
USD/JPY: The U.S. dollar strengthened against yen on Friday as investors digested US inflation data.The U.S. Commerce Department said the personal consumption expenditures (PCE) price index, widely seen as the Fed's favoured inflation indicator, increased 0.3% last month, in line with expectations and the March increase, while core PCE rose 0.2% compared with 0.3% in March.Separately the Chicago Purchasing Managers Index (PMI), which monitors the health of manufacturing in the Chicago region, fell to 35.4 from 37.9 last month and was well below economist expectations for 41. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.11% to 104.65. The dollar rose 0.27% to 157.23 against Japan's yen . Strong resistance can be seen at 157.40(23.6%fib), an upside break can trigger rise towards 157.89(Higher BB).On the downside, immediate support is seen at 155.77(50% fib), a break below could take the pair towards 155.00(Psychological level).
Equities Recap
European shares rose on Friday after softer U.S. inflation data spurred hopes of interest rates cuts by the Federal Reserve, while June rate cut bets for the euro zone remained intact despite hotter than expected inflation figures from the region.
UK's benchmark FTSE 100 closed up by 0.54 percent, Germany's Dax ended down by 0.07 percent, France’s CAC finished the day up by 0.18 percent.
The S&P 500 and Nasdaq posted losses for the week on Friday, breaking their five-week winning streaks, as investors digested an inflation report and assessed when the Federal Reserve might begin cutting interest rates.
Dow Jones closed up by 1.62% percent, S&P 500 closed up by 0.80 % percent, Nasdaq settled down by 0.01% percent.
Treasuries Recap
Yields fell after the signs of inflation stabilization in April, suggesting to some that the potential for the Fed to cut rates later this year remained intact.
The yield on benchmark U.S. 10-year notes fell 5.6 basis points to 4.499%, while the 30-year bond yield fell 4.7 basis points to 4.6384%.
The two-year note yield, which typically moves in step with interest rate expectations, fell 4.6 basis points to 4.8831%, from 4.929% late on Thursday.
Commodities Recap
Oil prices fell as traders focused on Sunday's OPEC+ meeting, which is expected to determine the fate of the producer group's output cuts.
U.S. crude settled down 1.18% at $76.99 a barrel and Brent settled at $81.62, down 0.29% on the day.
Gold fell 0.81% to $2,324.17 an ounce on the day but was tracking for a fourth straight monthly gain.
