Tuesday 5th May: European Open Briefing

Global Markets

Asian stock markets: Nikkei up 0.05 %, Shanghai Composite fell 1.85 %, Hang Seng lost 1.10 %, ASX rose 0.70 %
Commodities: Gold at $1186.50 (-0.05 %), Silver at $16.42 (-0.15 %), WTI Oil at $58.86 (-0.15 %), Brent Oil at (-0.10 %)
Rates: US 10 year note at 127.60, UK 10 year bond at 118.10, German 10 year bond at 155.53

News & Data:

RBA cuts main interest rate by 25 bps to 2.00 %
RBA: Inflation outlook provided scope to cut rates
RBA: Further A$ depreciation seems likely and necessary
Australia Trade Balance -A$1.32, Expected: -A$1.00bln, Previous: -A$1.61bln
Australia AiG Services Index 49.7, Previous: 50.2

Markets Update:

The main event overnight was the RBA rate decision. The bank cut its main rate by 25 bps to 2.00 % and said that its current inflation outlook provided scope to do so. However, a rate cut was expected by markets, so the losses for the Aussie Dollar were limited. AUDUSD fell briefly sub-0.78, but then reversed the entire move and printed a fresh intraday high above 0.79. Aside from the comment about the inflation outlook, there was not much new in the RBA statament. Further cuts are possible, but unlikely to happen within the next few months.

Other than that, it was a rather quiet session and the major currency pairs were all caught within a small range. USDJPY has been stuck between 120.00 and 120.30 for a while now. Dealers report solid selling interest around 120.30, with stops resting above 120.40. Meanwhile, bids in good size are reported at 119.80. GBPUSD weakened again yesterday and price action is likely to remain choppy as we head into the UK elections. The Euro got under pressure as cross flows (EURAUD, EURGBP) pushed the currency lower, but EURUSD has stabilized for now. Key support eyed at 1.1050 and then 1.10. A break back below 1.10 would likely trigger further momentum selling.

Upcoming Events:

09:30 BST – UK Construction PMI
10:00 BST – Euro Zone PPI
13:30 BST – Canadian Trade Balance
14:45 BST – US Services PMI
15:00 BST – US ISM Non-Manufacturing PMI
23:45 BST – New Zealand Unemployment Change
23:45 BST – New Zealand Unemployment Rate

The post Tuesday 5th May: European Open Briefing appeared first on .

Source:: Tuesday 5th May: European Open Briefing

Won't your trader friends like this?
IC Markets
About the Author
IC Markets is one of the world’s only True ECN forex brokers providing trading solutions for active day traders and scalpers as well as traders that are new to the forex market. IC Markets offers its clients cutting edge trading platforms, low latency connectivity and superior liquidity. IC Markets is revolutionizing on-line forex trading, on-line traders are now able to gain access to pricing and liquidity previously only available to investment banks and high net worth individuals. Visit IC Markets Website [space height="20"] [social type="facebook"]https://www.facebook.com/icmarkets[/social] [social type="twitter"]https://twitter.com/IC_Markets[/social] [social type="google-plus"]https://plus.google.com/+Icmarketsforex/posts[/social] [social type="youtube"]http://www.youtube.com/user/ICMarkets/[/social]

Related Posts

Leave a Reply