Market Roundup
- BoJ Gov Kuroda in Diet: Sticks to script, halfway to inflation target, will continue with QQE, output gap near zero, improving.
- BoJ DepGov Nakaso: Capital flows to-from Asia to become more volatile, natural as Asia integrates into global markets, promoting financial intermediation important to allay shocks, must boost infrastructure investment.
- China NRDC Li Pumin: To increase frequency of monetary policy adjustments.
- RBNZ Assistant Governor McDermott fuels talk of rate cut.
- Japan March corp service price index +3.2% y/y, +3.3% expected, Feb +3.3%.
- Foreign CB US debt holdings -$12.897 bln to $3.283 trln April 22 week, Tsy holdings -$11.375 bln to $2.956 bln, agencies -$1.525 bln to $283.187 bln.
Economic Data Ahead
- (0400 EDT/0800 GMT) Germany IFO Business Climate, consensus 108.4, previous 107.9
- (0400 EDT/0800 GMT) Germany IFO Current Assessment, consensus 112.4, previous 112.0
- (0400 EDT/0800 GMT) Germany IFO Expectations, consensus 104.5, previous 103.9
- (0830 EDT/1230 GMT) US Durable Goods Orders ex Transportation, consensus 0.3%, previous -0.4%
- (0830 EDT/1230 GMT) US Durable Goods Orders, consensus 0.6%, previous -1.4%
Key Events Ahead
- N/A Informal EcoFin meeting in Riga, Latvia (till tomorrow).
- N/A UK GBP0.5/1.0/1.5 bln 14/3/6-month treasury bill auctions.
- (0400 EDT/0800GMT) SNB Chair Jordan speech at Berne SNB annual shareholder meeting.
- (1030 EDT/1430 GMT) BoC Governor Poloz Speech
- (1130 EDT/1530 GMT)Buba Nagel speech in Frankfurt.
FX Recap
USD/JPY remained largely unchanged in Asia and traded close to yesterday's close at 119.55 levels. Traders are cautious ahead of the BoJ meeting scheduled at the end of the month. On the topside, immediate resistance is seen at 120.19 (April 14 High) levels and then at 120.45 (April 7 High) levels. On the other hand, support is likely to be found at 119.40 below which losses could be extended to 119 levels.
AUD/USD was unable to break above 0.78 handle and turned negative. It currently trades at 0.7770 levels, down from 0.7795 levels hit in the early Asian session. The pair has resistance at 0.78 levels and a break above could push it to 0.7850 levels. On the downside, support is located at 0.7744 (5-DMA) levels, below which it could extend its losses to 0.7713 (50-DMA).
NZD/USD continued moving in its downward trajectory and currently trades at 0.7559 levels. It remained pressured by RBNZ Governor's dovish comments. A convincing break of 0.7545 levels would drag the pair further down to 0.7480/0.7420. On the flipside, resistance is located at 0.76 levels and then at 0.7640 levels.
GBP/USD remained subdued in Asia and is hovering around 1.5045 levels. It has immediate resistance at 1.5050 levels, and a break above could see the pair testing 1.5104 (100-DMA), while major support is seen at 1.5 and a break below could extend its losses to 1.4964 levels.
EUR/USD dropped in Asia and has broken below the 1.0800 levels and currently trades at 1.0790 levels. A break below 1.0763 levels would make the way for 1.0700 levels, while a break above 1.0825 levels could see the pair reaching 1.0850 levels. Market now focuses on Euro group meeting due today for further cues on the pair.
