Market Roundup
- US TsySec Lew: Strong USD good, global economy needs faster growth; CNY not ready for IMF blessing as reserve currency.
- KC Fed George: Low rates encourage "reach-for-yield", time to talk about rates liftoff, must pare accommodation, not bothered by low inflation, little worry over high USD.
- BoJ Tankan: Big mfg DI +12, big non-mfg +19, +14 and +17 expected, non-mfg better in general than mfg, +10 and +17 expectedin June, previous estimate +16 and +17, big firms FY '15/16 CAPEX -1.2%, previous estimate +0.5%, recurring profits +1.3%, all firm employment index -17, conditions tighter, big firms see USD/JPY avge 111.81.
- Japan March final mfg PMI 50.3, flash 50.4, Feb 51.6, domestic orders down.
- China March final HSBC mfg PMI 49.6, flash 49.2, Feb 50.7, job losses faster.
- China March official services PMI 53.7, Feb 53.9.
- Australia March PMI +0.9 pt to 46.3, mfg still in contraction.
- Australia Feb bldg approvals -3.2% m/m, -4% eyed, priv-sector houses -0.1%.
- New Zealand March QV residential property price index +7.7% y/y, Feb +6.4%.
Economic Data Ahead
- (0230 EDT/0630 GMT) Sweden Mar mfg PMI, 54.2 consensus; previous53.3.
- (0315 EDT/0715 GMT)Spain Mar mfg PMI, 54.7 consensus; previous55.0.
- (0330 EDT/0730 GMT) Switzerland Mar mfg PMI, 47.2 consensus; previous 47.3.
- (0345 EDT/0745 GMT) Italy Mar mfg PMI, 52.2 consensus; previous51.9.
- (0350 EDT/0750 GMT)France Mar mfg PMI, 48.2 consensus; flash 48.2.
- (0355 EDT/0755GMT) Germany Mar mfg PMI, 52.4 consensus; flash 52.4.
- (0400 EDT/0800 GMT) Eurozone Mar mfg PMI, 51.9 consensus; flash 51.9.
- (0430 EDT/0830GMT) UK Mar mfg PMI, 54.3 consensus; previous54.1.
- (0815 EDT/1215GMT) US Mar ADP national employment, +225k consensus; previous +212k.
- (0945 EDT/1345GMT) US Mar Markit mfg PMI - final; flash 55.3.
- (1000 EDT/1400GMT) US Feb construction spending, unch m/m consensus; previous -1.1%.
- (1000 EDT/1400GMT) US Mar ISM mfg PMI, 52.5 consensus; previous 52.9.
- (1339 EDT/1730GMT) US Mar total vehicle sales, 16.7 mln AR consensus; previous 16.23 mln.
Key Events Ahead
- N/A ECB Governing Council meeting, no rate announcement scheduled.
- N/A Sweden treasury bill auction.
- N/A Atlanta Fed Stone Mountain conference, various speakers, attendees.
- (0630 EDT/1030GMT) Germany E4 bln zero% 2020 Bobl auction.
FX Recap
USD/JPY moved south in the Asian session away from the 120 handle, mainly due to rising safe-haven bids for the yen and a relatively weaker US dollar. It currently trades at 119.68 levels. On the topside, resistance is seen at 120 levels and above that it could extend its climb to 120.33 levels. On the other hand, support is seen at 119.23 levels, and a break below could see the pair testing 119 levels.
AUD/USD traded positive during the Asian session, largely on the back of stronger-than-expected China's manufacturing PMI for the month of March. It currently trades at 0.7633 levels, having posted a high of 0.7662 so far. It is expected to face resistance at 0.7700 levels and a break above would make way for 0.7725 levels. On the downside, support is located at 0.7600 levels and then at 0.7562 levels.
NZD/USD traded in the green on Wednesday in the mid-Asian session, after five consecutive days of losses. The NZD has been helped by New Zealand's house price growth along with stronger China PMI figures. It currently trades at 0.7465 levels. The immediate resistance is seen at 0.7491 levels, above which gains could be extended to 0.7516 levels. Support is seen at 0.7467 levels and then at 0.7420 levels.
EUR/USD partially trimmed its losses on Wednesday and turned positive. It currently trades at 1.0787 levels, recovering from 1.0729 levels hit earlier. It is likely to find support at 1.0730 levels and a break below could extend its losses to 1.0700 levels. On the flipside, resistance is eyed at 1.0833 levels, and a breach of this level would expose the 1.0860 level.
GBP/USD rose higher in Asia from 1.4820 to 1.4871 in Asia and currently trades at 1.4869 levels. Immediate support is seen at 1.4685, the low of March 19. On the other hand, resistance is located at 1.4903, Monday's high.
