Market Roundup
- RBA DepGov Lowe: AUD too high but closer to where it needs to be, scope to lower OCR if needed.
- China Premier Li: To target 7% growth, inflation likely 3%, budget deficit in 2015 2.3% of GDP.
- PBOC Chen Yulu: To maintain neutral monetary policy to ensure 6-7% growth, Policy data dependent, wary of capital flight, breakthrough reforms to come.
- Australia Jan trade deficit A$980 mln, A$950 mln consensus, exports +1%, imports +3%.
- Australia Jan retail sales +0.4% m/m, as expected, Dec +0.2%.
- Brazil Central Bank Copom raises benchmark Selic rate 50 bps to 12.75%, as expected.
Economic Data Ahead
- (0130 ET/0630 GMT) France Q4 ILO unemployment, 10% consensus; previous 10.4%.
- (0200 ET/0700 GMT) Germany Jan industrial orders, -1.0% m/m consensus; previous +4.2%.
- (0330 ET/0830 GMT) Sweden Jan industrial production, unchanged m/m, -0.3% y/y consensus; previous +1.7%, -1.6%.
- (0330 ET/0830 GMT) Sweden Jan new mfg orders; previous -11.4% y/y.
- (0400 ET/0900 GMT) Italy Q4 GDP final, unchanged q/q, -0.3% y/y consensus; prelim unchanged, -0.3%.
- (0730 ET/1230 GMT) US Feb Challenger layoffs; previous 53.04k.
- (0830 ET/1330 GMT) US Q4 productivity revised, -2.3% q/q consensus; previous -1.8%.
- (0830 ET/1330 GMT) US Q4 unit labor costs revised, +3.3% SAAR consensus; previous +2.7%.
- (0830 ET/1330 GMT) US w/e initial jobless claims, 295k consensus; previous 313k.
- (1000 ET/1500 GMT) US Jan factory orders, +0.2% m/m consensus; previous -3.4%, -2.3% ex-transport.
Key Events Ahead
- N/A Riksbank Gov Ingves, DepGov Jochnick Riksdag testimony.
- N/A Canada FinMin Oliver speech at Ottawa conference.
- (0430 ET/0930 GMT) Spain E4-5 bln 0.5/1.4/5.75% 2017/20/32 Bono auctions.
- (0450 ET/0950 GMT) France E7.5-8.5 bln 4.25/0.5/3.5% 2023/25/29 OAT and OATei auctions.
- (0700 ET/1200 GMT) BoE MPC policy announcement, no changes in policy consensus, bank rate 0.5%.
- (0745 ET/1245 GMT) ECB policy announcement, refi rate 0.05%, depo -0.2%, QE details consensus.
- (0830 ET/1330 GMT) ECB Pres Draghi press conference.
- (1630 ET/2130 GMT) Fed bank stress test results.
FX Recap
EUR/USD hovered near its weakest level in over 11 years on Thursday, as investors waited for the European Central Bank to announce its QQE programme. It now trades at 1.1059, lower than yesterday's low of 1.1060.
USD/JPY trades flat in the mid-Asian trading, as the pair is underpinned by safe-haven bids for the yen ahead the ECB meeting. On the topside, the immediate resistance is located at 120 levels and above the pair could be pushed to 120.27 (March 3 High) levels. On the flipside, next support is seen at 119.48 (10-DMA) levels, and then at 119.27 (20-DMA) levels.
AUD/USD was momentarily boosted by RBA Deputy Governor Philip Lowe's comment that the Australian dollar was much closer to fair value than at any time in the past couple of years. The statement pushed the pair to as high as 0.7840. However, it slid later and now trades around 0.7816 levels.
NZD/USD closed in New York at 0.7590, it's highest in six weeks. It was helped by weakness in AUD/NZD. However, NZD/USD dropped through 0.7580 levels to 0.7549 in the Asian session. Its immediate resistance is located at 0.7600 levels and above which the gains could be extended to 0.7615 levels. On the flip side, it is likely to get support at 0.7530 (50-DMA) levels and then at 0.7500 levels.
