Market Roundup
- EUR/USD hits a fresh 12 year low at 1.1026 ahead of ECB.
- China's growth target for 2015 around 7 pct, below 2014's 7.5 pct goal.
- China Economic Planning Agency Chairman says not concerned about side effects of Europe easing.
- BOJ's Kiuchi says cutting interest paid on excess reserves at BOJ could be future option if and when BOJ starts to taper asset purchases; QQE is not best suited for short-term fine-tuning such as responding to slump in economic growth.
- Russia central bank DepGov says if banks' retail deposits don't grow then central bank willing to provide banks with additional liquidity.
- France Q4 ILO Unemployment Rate stays flat at 10.4 % vs previous 10.40 %.
- Germany Jan Industrial Orders mm decreases to -3.9 % (consensus -1.0 %) vs previous 4.2 %.
- United Kingdom Feb Halifax House Prices mm decreases to -0.3 %(consensus -0.2 %) vs previous 2.0 %.
- United Kingdom Feb Halifax House Price 3m/yy decreases to +8.3 % (consensus 8.5 %) vs previous 8.5 %.
- Italy Q4 GDP Final qq stays flat at 0.0 % (consensus 0.0 %) vs previous 0.0 %.
- Italy Q4 GDP Final yy decreases to -0.5 % (consensus -0.3 %) vs previous -0.3 %.
Economic Data Ahead
- (0730 ET/1230 GMT) US Challenger Job-Cut Report (Feb) (previous 53,041)
- (0830 ET/1330 GMT) US Initial Jobless Claims (Feb 28 week)(consensus 295k, previous 313k)
- (0830 ET/1330 GMT) US Continued Claims (Feb 21 week) (consensus 2.400 mln, previous 2.401 mln)
- (0830 ET/1330 GMT) US Productivity (Q4 revised) (consensus -2.3% q/q AR, previous -1.8% q/q AR)
- (0830 ET/1330 GMT) US Unit Labor Costs (Q4 revised) (consensus 3.3% q/q AR, previous 2.7% q/q AR)
- (1500 ET/2000 GMT) US Factory Orders (Jan) (consensus +0.2% m/m, previous -3.4% m/m)
- (1500 ET/2000 GMT) US ex Trans Factory Orders (Jan) (previous -2.3% m/m)
Key Events Ahead
- (0700 ET/1200 GMT) BoE MPC policy announcement, no changes in policy eyed, bank rate 0.5%
- (0745 ET/1245 GMT) ECB policy announcement, refi rate 0.05%, depo -0.2%, QE details expected
- (0830 ET/1330 GMT) ECB Pres Draghi press conference
- (1000 ET/1500 GMT) One-Week Term RRP Operation (size and max offering rate TBD)
- (1000 ET/1500 GMT) FRB San Francisco's Williams (voter, dovish) speaks
- (1145 ET/1645 GMT) FedTrade operation 30-year Ginnie Mae (max $1.050 bln)
- (1630 ET/2130 GMT) Fed releases Dodd-Frank Act Stress Test Results
- (2315 ET/0415 GMT) FRB San Francisco's Williams (voter, dovish) on the economic outlook
FX Recap
EUR/USD recovered slightly in the mid-European trading from 1.1026 levels and now trades around 1.1050 as investors await the ECB meeting. Traders are expected to analyse the growth and inflation forecasts to be released by the central bank for further insights on the economic situation in the common currency area. Pair's next resistance is located at 1.1082 levels, above which it could extend gains to 1.1100 levels. Support is located at 1.100 levels, below which the pair can further slide sub 1.10 mark. Option expiries at 1.1000 (325M), 1.1050 (441M), 1.1100 (1.1BLN), 1.1150 (1.4BLN).
USD/JPY continues its uptrend and is now hovering near 120.00 levels. It is consolidating between 120.25 and 119.40 for the past two trading session and is likely to test 120.30 (Monday high). Intraday trend is bullish as long as support 119.30 holds. On the upside, break above 120.25 would pave the way for next target around 121/121.80. Only a break below 118 will confirm the end of bullish trend. The pair's minor support is around 119.30 (200 day HMA) and break below will target 118.60/118.20. Option expiries at 119.00 (948M), 119.25 (800M), 119.50 (385M), 120.00 (3BLN).
AUD/USD weakened and the pair slid to its 10-DMA at 0.7810 after China lowered its growth target to 7% for this year, from 7.5% set in 2014. It is likely to fall below 0.78 levels today as the USD is still boosted against major currencies ahead of Friday's NFP report. Moreover, AUD is also underpinned by the RBA's dovish outlook with respect to the interest rates. On the topside, immediate resistance is seen at 0.7860 and 0.7900 levels. On the downside, support is located at 0.7800 and 0.7850 levels. Option expiries at 0.7850 (1.9BLN).
USD/CHF extended its move upwards in the morning European session, driven by a strong US dollar.Currently, it trades at 0.9682 levels, breaking above the fresh seven-week highs posted at 0.9678 levels in the previous session. On the topside, the immediate resistance is seen at 0.9700 levels. On the other hand, support is seen at 0.9604 levels and then at 0.9550 levels. Option expiries at 0.9645-50 (930M).
GBP/USD fell to one-month lows on Thursday, after subdued U.K. house price data and as markets remained wary ahead of the Bank of England's upcoming monetary policy statement to be released later in the day. It touched 1.5225 during morning European session, the lowest since February 12 and later consolidated at 1.5241 levels. Pair's immediate support is seen at 1.5161 and resistance at 1.5372. Option expiries at 1.5300 (180M).
