Market Roundup
- GBP hits 4 week high against euro on Greek concern, UK data.
- Euro zone government borrowing costs slid to new lows on Thursday, a day after the ECB pledged to fulfil its 1 trillion euro bond-buying programme.
- Germans downbeat on chances of Greek deal due next week.
- Greek officials made an informal approach to delay repayments of its loans.
- France Sapin says Greece must stay in euro.
- IMF Blanchard: Excessive falls in EUR/USD to around 0.8000 could be halted by ECB/Fed if required.
- Italy Feb Trade Balance EU increases to 0.691 bln eur vs previous 0.452 bln eur.
- Italy Feb Global Trade Balance increases to 3.538 bln eur vs previous 0.219 bln eur.
- UK March RICS Housing survey +21 vs previous +15 revised. +15 consensus.
- Australia March jobs +37.7K vs poll +15K, unemployment rate 6.1% vs 6.3%.
- Switzerland Mar Produce/Import price 0.2% m/m, -3.4% y/y vs previous -1.4%/-3.6%.
Economic Data Ahead
- (0830 EDT/1230 GMT) US Housing Starts mm, consensus 1.040m, previous 0.897m
- (0830 EDT/1230 GMT) US Building Permits mm, consensus 1.080m, previous 1.092m
- (0830 EDT/1230 GMT) US Continuing Jobless Claims, previous 2.304
- (0830 EDT/1230 GMT) US Initial Jobless Claims, previous 281k
- (0830 EDT/1230 GMT) US Philadelphia Fed Manufacturing Survey, consensus 6.3, previous 5.0
Key Events Ahead
- (0900 EDT/1300 GMT)ECB VP Constancio speaks before the Levy Economics Institute; Washington, DC
- (1300 EDT/1700 GMT) Fed's Lockhart Speech
- (1310 EDT/1710 GMT) FOMC Member Mester Speech
- (1330 EDT/1730 GMT) Federal Reserve Bank of Boston President Rosengren speech
- (1500 EDT/1900 GMT) Fed's Stanley Fisher Speech
FX Recap
EUR/USD dropped to session low of 1.0623 levels in Europe, following the plunge in the bond yield across the Eurozone. On the topside, immediate resistance is located at 1.0692 (10-DMA), and a break above could extend its gains to 1.0745 levels. On the downside, 1.0625 (5-DMA) is expected to provide support to the pair, below which it could be dragged to 1.0566 (April 10 low). Option expiries at 1.0500 (836M), 1.0550 (984M), 1.0600 (886M), 1.0640-50 (1.2B), 1.0700 (983M), 1.0800 (1.6B).
GBP/USD is continuing its move upwards and currently trades at 1.4903 levels having posted a high of 1.4910 levels. UK's labor market data is scheduled for release tomorrow, with Claimant Count Change expected to have fallen by 28k last month while unemployment rate is expected to stand at 5.6 percent in the first quarter. On the downside, support is seen at 1.4829 levels and then at 1.4782 levels. Resistance is seen at 1.4920 levels and then at 1.4977 levels.
USD/CAD has broken major support 1.2350 and this confirms short term weakness a decline till 1.11903 cannot be ruled out. On the upside minor resistance is around 1.2320 and any break above could extend gains till 1.2350/1.2380. The pair's major support is around 1.2180 and break below will drag the pair further down till 1.11903. Option expiries at 1.2790 (276M), 1.2800 (1.0B).
USD/JPY: The Japanese yen strengthened further on Thursday on soft US data, weak U.S. GDP outlook as forecast by the IMF along with a slowdown in China. The pair is hovering around 119.07 levels, with a high of 119.46 levels and a low of 118.78 levels. It has resistance at 119.31 (100-DMA), and a break above could see the pair testing 119.62 (5-DMA). On the other hand, support is located at 118.77 (previous session's low), and then at 118.31 (March. 26 low). Option expiries at 121.00 (542M), 121.05 (620M), 121.30 (390M), 122.0 (400M), 124.00 (1.1B).
EUR/CHF seen recovering, but the upward move is likely to be capped by 1.0350 levels. It currently trades at 1.0322 levels, having posted a high of 1.0336 levels so far. A break above 1.0350 levels could push the pair to 1.038 levels. On the flipside, support is located at 1.0294 levels and then at 1.0270 levels. USD/CHF remained pressured on Thursday and fell to 0.9604 levels before consolidating to 0.9629 levels.
