Market Roundup
•Canada Apr Housing Starts (MoM) 2.2%, -0.8% previous
•US Apr Building Permits 1.416M,1.437M forecast,1.430M previous
• US Apr Housing Starts 1.401M, 1.400M forecast,1.420M previous
• US Mar Foreign Securities Purchases -19.07B,5.22B forecast,4.62B previous
•Canada Mar Foreign Securities Purchases by Canadians -5.59B ,-1.61B previous
•US Apr Building Permits (MoM) -1.5%, -7.7% previous
•US Cushing Crude Oil Inventories 1.461M,0.864M forecast,0.397M previous
•US Distillate Fuel Production 0.250M,0.039M forecast,0.030M previous
•US Gasoline Production-0.341M,-0.107M forecast,0.445M previous
•US Crude Oil Inventories 5.040M,-0.920M forecast,2.951M previous
Looking ahead Economic Data(GMT)
•01:30 Australia Apr Employment Change 25.0K forecast, 53.0K previous
•01:30 Australia Apr Full Employment Change 72.2K previous
•01:30 Australia Apr Participation Rate 66.7% forecast,66.7% previous
•01:30 Australia Apr Unemployment Rate 3.5% ,3.5% previous
•02:00 New Zealand Jan Budget Balance -25.364B previous
•02:00 New Zealand Jan Net Debt Forecast 39.80% forecast,39.20% previous
•02:00 New Zealand Jan Economic Forecast -20.233B forecast, -3.630B previous
Looking Ahead Events And Other Releases(GMT)
•No events ahead
Currency Forecast
EUR/USD: The euro dipped against dollar on after data showed Euro zone inflation ticks up in April.Euro zone inflation accelerated last month, Eurostat said on Wednesday, confirming preliminary data pointing to increasingly stubborn price growth among the 20 nations sharing the euro.Overall price growth accelerated to 7.0% in April from 6.9% a month earlier, as rising services and energy costs offset a slowdown in food price growth. Inflation has been above the ECB's 2% target for nearly two years and the bank has lifted interest rates by a combined 375 basis points since last July to arrest runaway price growth. Immediate resistance can be seen at 1.0898(5DMA), an upside break can trigger rise towards 1.1000(Psychological level).On the downside, immediate support is seen at 1.0818 (Daily low ), a break below could take the pair towards 1.0818(Lower BB).
GBP/USD: The pound initially dipped against dollar on Wednesday but recovered some losses after Bank of England Governor Andrew Bailey reiterated he expected price pressures to ease, as soon as April. Speaking at the British Chambers of Commerce Global Annual Conference, Bailey said that if price pressures were to be more persistent, further tightening of policy may be required, but added there were signs the labour market was loosening a little.On Tuesday, data showed Britain’s jobless rate rose to 3.9%, while the rate of increase in total pay, including bonuses, held steady, prompting some investors to scale back their bets on further interest rate hikes.Immediate resistance can be seen at 1.2528 (5DMA), an upside break can trigger rise towards 1.2638 (11th May High).On the downside, immediate support is seen at 1.2425(50%fib), a break below could take the pair towards 1.2377(Lower BB).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as risk appetite rose and investors raised bets on another interest rate hike by the Bank of Canada, but the move was not enough for the currency to break out of its recent range. The Canadian 2-year yield touched its highest level since March 10 at 4.072% before dipping to 4.058%, up 8.7 basis points on the day. The loonie was trading 0.3% higher at 1.3445 per U.S. dollar, or 74.38 U.S. cents, which was toward the middle of its range since the start of the month of roughly 1.33 to 1.36. Immediate resistance can be seen at 1.3479 (23.6%fib), an upside break can trigger rise towards 1.3494 (50DMA).On the downside, immediate support is seen at 1.3400 (38.2%fib), a break below could take the pair towards 1.3331 (50%fib).
USD/JPY: The dollars strengthened against Japan's yen on Wednesday as traders trimmed bets on imminent U.S. rate cuts following solid consumer spending data, while the greenback also benefitted from its status as a safe-haven so long as risk of a U.S. debt default remained. U.S. President Joe Biden and the senior congressman, Republican Kevin McCarthy, have edged closer to a deal to raise the U.S. debt ceiling, but nothing is clinched yet.Biden said any default would land the economy in recession, but investors also fear the impact globally would be negative. Dollar rose 0.5% against the yen to a two-week peak of 137.60 . Strong resistance can be seen at 137.63(Daily high) an upside break can trigger rise towards 137.85(Higher BB).On the downside, immediate support is seen at 136.27(Daily low), a break below could take the pair towards 135.87(38.2%fib)
Equities Recap
European stocks posted their worst daily fall in one week on Wednesday, tracking weakness on Wall Street, as investors grew wary of rising inflationary pressures increasing the odds of an early tightening of monetary policy.
UK's benchmark FTSE 100 closed down by 0.36 percent, Germany's Dax ended up by 0.34 percent, France’s CAC finished the day down by 0.09 percent.
Wall Street rallied to a higher close on Wednesday, gathering momentum throughout the afternoon trading, and the dollar touched a six-week high as regional banks surged and negotiations in Washington over raising the debt ceiling progressed.
Dow Jones closed up by 1.24 percent, S&P 500 ended up by 1.19 percent, Nasdaq settled up by 1.28 percent.
Treasuries Recap
U.S. Treasury yields rose on Wednesday amid some cautious optimism around lawmakers' talks to raise the U.S. debt ceiling and on the back of strengthening expectations of higher-for-longer interest rates.
Benchmark 10-year yields rose three basis points to 3.579% while two-year yields added eight basis points to 4.154%.
Commodities Recap
Gold retreated on Wednesday as the dollar advanced after hawkish comments from U.S. Federal Reserve officials raised doubts over interest-rate cuts this year.
Spot gold dropped 0.4% to $1,981.39 per ounce by 2:15 p.m. EDT (1815 GMT) after touching its lowest since April 27. U.S. gold futures settled down 0.4% at $1,984.90.
Oil prices settled up about $2 on Wednesday as optimism over oil demand and U.S. debt ceiling negotiations outweighed worries about abundant supply.
Brent crude futures settled up $2.05, or 2.7%, to $76.96 a barrel. West Texas Intermediate U.S. crude settled up $1.97 or 2.8% to $72.83.
