Europe Roundup: Euro advances towards two-week high against dollar, European shares inch lower, Gold rises, Oil up on lower U.S. stocks, firmer demand-May 20th,2020

Market Roundup

• UK April PPI Output (MoM)  -0.7%,-0.5% forecast, -0.2% previous

• UK April PPI Output (YoY)  -0.7%, -0.4% forecast, 0.3%  previous

• UK April Core PPI Output (MoM)  -0.1%,-0.1% forecast, 0.3% previous

• UK April Core PPI Output (YoY)  0.6%,0.6% forecast, 0.9% previous

• UK April PPI Input (MoM)  -5.1%,-4.0% forecast, -3.6% previous

• UK April PPI Input (YoY)  -9.8%,-8.7% forecast, -2.9% previous

• UK April RPI (MoM)  0.0%,0.1% forecast, 0.2% previous

• UK April RPI (YoY)  1.5%,1.6% forecast, 2.6% previous

• UK April CPI (YoY)  0.8%,0.9% forecast, 1.5% previous

• UK April Core RPI (MoM)  0.0% forecast, 0.2% previous

• UK April CPI (MoM)  -0.2%, -0.1% forecast, 0.0% previous

• UK April CPI, n.s.a  108.50, 108.60 previous

• UK April Core RPI (YoY)  1.6%, 2.7% previous

• UK April Core CPI (YoY)  1.4%,1.5% forecast, 1.6% previous

• UK April Core CPI MoM (MoM)  0.1%, 0.2% forecast, 0.1% previous

• EU March Current Account  27.4B, 40.2B previous

• EU March Current Account n.s.a.  40.7B, 33.8B  previous

• EU April CPI (MoM)  0.3%,0.3% forecast, 0.5%  previous    

• EU  April HICP ex Energy and Food (MoM) 0.7%,0.7% forecast, 1.0%  previous    

• EU  April CPI ex Tobacco (MoM)  0.3%,0.5% previous    

• EU  April Core CPI (YoY)  0.9%,0.9% forecast, 1.0% previous    

• EU  April CPI (YoY)  0.3%, 0.4% forecast, 0.7% previous 
   
• Portuguese March Current Account  -1.119B, -0.713B previous    

Looking Ahead - Events, Other Releases (GMT)    

• 12:30 Canada April Core CPI (MoM)  0.7% previous
    
• 12:30 Canada April CPI (MoM)  -0.6% forecast, -0.6% previous    

• 12:30 Canada April Core CPI (YoY)  1.6% previous    

• 12:30 Canada April CPI (YoY) -0.1% forecast, 0.9% previous
    
• 12:30 Canada March Wholesale Sales (MoM) -3.8% forecast, 0.7% previous    

• 12:30 Canada Common CPI (YoY) 1.7% previous    

• 12:30 Canada Trimmed CPI (YoY) 1.8% previous

• 12:30 Canada Median CPI (YoY) 2.0% previous

• 13:00 Belgium May Consumer Confidence -26 previous

• 13:30 US Seevol Cushing Storage Report -2.177M previous

• 13:30 Brazil Federal Tax Revenue 109.70B previous

• 13:30 EU May Consumer Confidence  -24.0 forecast, -22.7 previous

• 14:30 US Crude Oil Inventories 1.151M forecast, -0.745M previous  
 
• 14:30 US Gasoline Inventories -2.134M forecast, -3.513M previous

• 14:30 US Cushing Crude Oil Inventories -3.002M previous

Looking Ahead - Events, Other Releases (GMT)

• 13:30 UK BoE Gov Bailey Speaks

•18:00 US FOMC Meeting Minutes

•18:00 Canada BoC Gov Council Member Lane Speaks

Fxbeat

EUR/USD: The euro continued its gain against greenback on Wednesday, climbing towards a two-week high, as a Franco-German proposal for a common fund that could move Europe closer to a fiscal union boosted demand for the currency. France and Germany have proposed a 500 billion euro ($543 billion) Recovery Fund to offer grants to regions and sectors hit hardest by the coronavirus pandemic and to allow borrowing by the European Commission on behalf of the whole EU. The euro edged up 0.2% to $1.0960  , near to a two-week peak of $1.09755 reached on Tuesday. Immediate resistance can be seen at 1.0981 (38.2% fib), an upside break can trigger rise towards 1.1000 (Psychological level).On the downside, immediate support is seen at 1.0915 (50% fib), a break below could take the pair towards 1.0847 (38.2% fib).

GBP/USD: Sterling edged higher against dollar on Wednesday, but clouds lingered over the pound after UK inflation fell below 1% to its lowest in nearly four years. The drop in inflation fuelled speculation the Bank of England would cut interest rates below zero to bolster an economy hammered by the coronavirus pandemic. Inflation sank to 0.8% in April, its lowest since August 2016. The pound fell after the data were released. Sterling last trading up 0.16% against the dollar at 1.2263.Immediate resistance can be seen at 1.2275 (50% fib),an upside break can trigger rise towards 1.2364 (61.8%fib).On the downside, immediate support is seen at 1.2206 (5 DMA), a break below could take the pair towards 1.2185 (38.2% fib).

USD/CHF: The dollar dipped against the Swiss franc on Wednesday as concerns about a deep post-pandemic recession returned to the fore after a report cast doubts on the effectiveness of a potential coronavirus vaccine. A day after markets rallied on hopes of a vaccine for COVID-19, a report from medical news website STAT questioned the lack of details in U.S. drugmaker Moderna’s early stage study of the vaccine, raising doubts about its effectiveness. Immediate resistance can be seen at 0.9695 (30 DMA), an upside break can trigger rise towards 0.9721  (23.6% fib).On the downside, immediate support is seen at 0.9615 (38.2 %fib), a break below could take the pair towards 0.9533 (50 % fib).

USD/JPY: The dollar rose against the Japanese yen Wednesday after Japanese business confidence slumped to a decade low The sentiment index at manufacturers slumped to minus 44 in May from minus 30 in the previous month, the lowest since June 2009, while the service-sector gauge plunged to minus 36 from minus 23, the worst reading since December 2009. The downbeat findings came after data this week showed the world’s third-largest economy slipped into its first recession in 4-1/2 years last quarter.Strong resistance can be seen at 107.80 (38.2 % fib), an upside break can trigger rise towards 108.16 (Higher BB).On the downside, immediate support is seen at 107.57 (30 DMA), a break below could take the pair towards 106.57 (50 % fib). 

Equities Recap

European shares headed lower on Wednesday after a downbeat session on Wall Street, as doubts over a potential COVID-19 vaccine reignited fears about the slow recovery from a looming global recession.

At (GMT 12:05 ),UK's benchmark FTSE 100 was last trading up at 0.32 percent, Germany's Dax was up by 0.17 percent, France’s CAC finished was down by 0.35 percent.

Commodities Recap

Gold prices rose on Wednesday as doubts over a potential coronavirus vaccine intensified fears over prolonged global economic weakness and prompted investors to seek safe-haven bullion.

Spot gold was up 0.3% to $1,748.73 per ounce by 0921 GMT. U.S. gold futures rose 0.5% to $1,753.40 per ounce.

Oil prices firmed on Wednesday on signs of improving demand and a drawdown in U.S. crude inventories, but worries over the economic fallout from the coronavirus pandemic and weak refining margins capped gains.

Brent crude futures were up 51 cents, or 1.47%, at $35.16 per barrel at 0928 GMT.U.S. West Texas Intermediate (WTI) July crude futures were up 22 cents, or 0.69%, at $32.18 a barrel.

Treasuries Recap

Italian bond yields held near multi-week lows early Wednesday, undeterred by the prospect of a hawkish counter-proposal to a plan for a recovery fund offered by France and Germany.

Italy’s 10-year bond yield was up only 2 basis points at 1.66%, near the five-and-a-half-week lows reached after France and Germany made their proposal. The risk premium it pays  the gap with Germany’s 10-year yield  was at 211 basis points, less than 10 bps higher than Tuesday’s five-week lows.