Wednesday 29th April: European Open Briefing

Global Markets:

  • Asian stock markets: Nikkei up 0.40 %, Shanghai Composite dropped 0.35 %, Hang Seng fell 0.40 %, ASX declined 1.50 %
  • Commodities: Gold at $1211 (-0.25 %), Silver at $16.60 (-0.15 %), WTI Oil at $56.95 (-0.20 %), Brent Oil at $64.50 (-0.20 %)
  • Rates: US 10 year yield at 2.003, UK 10 year yield at 1.704, German 10 year yield at 0.166

News & Data:

  • New Zealand Trade Balance -NZ$2.4bln, Expected: -NZ$2.74bln, Previous: -NZ$2.18bln
  • New Zealand Exports NZ$4.93bln, Expected: NZ$4.40bln, Previous: NZ$3.92bln
  • New Zealand Imports NZ$4.30bln, Expected: NZ$4.06bln, Previous: NZ$3.87bln
  • New Zealand ANZ Business Confidence 30.2, Previous: 35.8
  • China Westpac Consumer Sentiment 111.1, Previous: 114.7
  • Asia shares fade, dollar pressured before Fed – RTRS
  • Oil dips as oversupply outweighs Saudi royal reshuffle – RTRS
  • Tsipras presses for May debt deal, threatens referendum – RTRS
  • Asian Stocks Retreat as Dollar Holds Slump Before Fed; Oil Drops – BBG

Markets Update:

The USD weakened sharply yesterday and extended the losses overnight, as traders are expecting a weak GDP Print and a dovish FOMC today. Growth in the US economy has likely slowed to 1.0 % per quarter, partly due to the harsh winter. Further, there are not many reasons for the FOMC to be overly hawkish today given the poor economic data in the past few weeks.

USD/JPY is holding very well despite the broad Dollar weakness, but banks report large stops below 118.50 and position covering is likely to accelerate should it break below that level. USD/CAD barely held above 1.20 overnight, but also looks very vulnerable. Sub-1.20, not much support noted until 1.18.

In EUR/USD, the next big level is 1.1035 (the current month’s high). Meanwhile, GBP/USD had advanced to fresh multi-week highs, despite yesterday’s disappointing UK GDP print. Immediate resistance seen at 1.54 and above there, not much until 1.5550.

Upcoming Events:

  • 08:30 BST – Swedish Central Bank Interest Rate Decision (-0.35 %)
  • 09:00 BST – Euro Zone M3 Money Supply (4.3 %)
  • 10:00 BST – Euro Zone Business Climate (0.2)
  • 10:00 BST – Euro Zone Consumer Confidence (-5.0)
  • 13:00 BST – German CPI (-0.1 % m/m, 0.4 % y/y)
  • 13:00 BST – German HICP (-0.1 % m/m, 0.2 % y/y)
  • 13:30 BST – US GDP (1.0 % q/q)
  • 15:00 BST – US Pending Home Sales (1.0 % m/m)
  • 19:00 BST – FED Interest Rate Decision
  • 19:00 BST – FOMC Statement
  • 22:00 BST – RBNZ Interest Rate Decision
  • 22:00 BST – RBNZ Statement

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