Market Roundup
- China Premier Li: Achieving 7% growth in '15 won't be easy; we will increase the intensity of targeted policy control.
- ECB Governing Council Member: Interest rates could not remain near zero forever.
- Greek FinMin Varoufakis: Greek liquidity problems insignificant, ECB QE leading to equity gains but unlikely to lead to investment-led recovery in countries like Italy and Spain.
- RBA AsstGov DeBelle: Working on replacement for BBSW benchmark, shortage of risk-free assets best reason for compressed yields, sharp decline in oil prices hit inflation expectations.
- Australia Feb new motor vehicle sales +2.9% m/m, +4.1% y/y, best in a year.
- NZ Feb PSI 55.6, Jan 57.8 and six-month high.
Economic Data Ahead
- (0415 EDT/0815GMT) Switzerland Jan retail sales; previous +2.2% y/y.
- (0415 EDT/0815GMT) Switzerland Feb producer/import prices; previous -0.6% m/m, -2.7% y/y.
- (0830 EDT/1230 GMT) US Mar Empire State manufacturing index, 8.0 consensus; previous 7.78.
- (0915 EDT/1315GMT) US Feb industrial/mfg output, +0.2% and +0.1% m/m consensus; previous +0.2%, +0.2%.
- (0915 EDT/1315GMT) US Feb capacity utilization, 79.5% consensus; previous 79.4%.
- (1000 EDT/1400 GMT) US Mar NAHB housing market index, 56.0 consensus; previous 55.0.
Key Events Ahead
- N/A BoJ Policy Board meeting, announcement tomorrow.
- N/A Frankfurt Finance Summit (till tomorrow), various speakers.
- N/A SZ Finance Day '15 events (till tomorrow)/(1445 EDT/1845 GMT)ECB Pres Draghi speech.
- N/A France 2/6/12-mo BTF, Netherlands 3/6-mo DTC, Norway bill auctions.
- (0400 EDT/0800 GMT) BoS Linde speech in Doha, Qatar.
- (0830 EDT/1230 GMT) Canada net international securities flow data.
- (1300 EDT/1700 GMT) EC Moscovici speech in Hanover.
- (1600 EDT/2000 GMT) US Treasury international capital flows data (TIC), previous $174.8 bln net outflows.
FX Recap
EUR/USD slumped to a fresh 12-year low on Monday as the recent jump saw fresh selling interest suggesting that investors were still very bearish on the common currency. It dropped to 1.0457 (Jan 2003 low) in the early Asian session, after a concise bounce above 1.0600 overnight. It currently trades at $1.0521.
USD/JPY continued its choppy trade around 121.32 levels, with a high of 121.46 and a low of 121.29. It is likely to see some action today as markets await US industrial production figures and also BOJ monetary policy statement scheduled tomorrow. However, the major event due this week is the FOMC meeting and Yellen's subsequent press conference. Pair is likely to find support at 120.43 and then at 119.73, 119.00 levels. On the upside, resistance is located at 122 levels.
AUD/USD traded flat in the mid-Asian session as traders remain cautious ahead of the RBA monetary policy meeting minutes scheduled for release tomorrow. It currently trades at 0.7645 levels, closer to the six-year low of 0.7561 hit last week. It sees immediate support at 0.7610 (Friday low) levels and resistance at 0.7713 levels.
NZD/USD traded around 0.7363 levels, well above a four-year low of 0.7177 touched in February. However, the pair is still being undermined by RBNZ's last week statement suggesting it is in no hurry to cut rates. On the topside, resistance is seen at 0.7440 levels. On the other hand, support is seen at 0.73 levels
USD/CNY weakened on Monday after the PBOC set a weaker midpoint rate at 6.1615 per dollar, from the previous fix of 6.1588, reflecting the greenback's global strength. The spot yuan opened at 6.2620 per dollar and was trading at 6.2618 by late morning.
