Market Roundup
•Tehran plays down suspected attack by Israel
•Gold up over 2% for the week
• U.S. Baker Hughes Oil Rig Count 511, 506 previous
• U.S. Baker Hughes Total Rig Count 619, 617 previous
Looking Ahead Economic Data(GMT)
•No Data Ahead
Looking Ahead Events And Other Releases (GMT)
•No Significant Events
Currency Forecast
EUR/USD: The euro edged higher as dollar gained on Friday as gains were driven by heightened tensions in the Middle East conflict, which unnerved investors. The escalating tensions between Israel and Iran also fuelled concerns that a spike in commodity prices could rekindle inflation and delay the European Central Bank's highly anticipated interest rate cut in June. On the data front, German producer prices fell less than expected in March, decreasing by 2.9% on the year, the federal statistics office reported on Friday. Analysts polled had expected a 3.2% decline.The office publishes more detailed data on its website. Immediate resistance can be seen at 1.2365 .0370(50%fib), an upside break can trigger rise towards 1.0711(61.8%fib).On the downside, immediate support is seen at 1.2365 (38.2%fib), a break below could take the pair towards 1.2341(23.6%fib).
GBP/USD: Sterling declined against the dollar on Friday after dovish comments from Bank of England Deputy Governor Dave Ramsden, while Middle East tensions continued to sour sentiment. Bank of England Deputy Governor Dave Ramsden said on Friday that the risk of British inflation getting stuck too high had receded and it might prove weaker than the BoE's most recent forecasts. Ramsden, who has voted recently to keep interest rates at their highest since 2008, said inflation could remain around the BoE's 2% target for the next three years rather than rise higher later this year as the central bank forecast in February. The pound is down marginally for the week but off by 1.5% for the month so far after a jump in the dollar caused by strong U.S. economic data. The dollar index was 0.1% higher on Friday. Immediate resistance can be seen at 1.2462(38.2%fib), an upside break can trigger rise towards 1.2516(50%fib).On the downside, immediate support is seen at 1.2392(23.6%fib), a break below could take the pair towards 1.2375(Dec 12th low).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Friday as oil prices rose and the market took stock of recent losses for the currency, but the move was limited following the recent move in yield spreads in favor of the greenback. The slowdown in Canadian inflation has contrasted with the recent heating up of U.S. price pressures, raising bets the Bank of Canada would begin easing interest rates before the Federal Reserve.The price of oil, one of Canada's major exports, pared its earlier gains after Iran played down a reported Israeli attacks on its soil, in a sign that an escalation of hostilities in the Middle East might be avoided. Still, U.S. crude oil futures were up 0.7% at $83.27 a barrel. The loonie was trading 0.1% higher at 1.3750 per U.S. dollar, or 72.73 U.S. cents, after trading in a range of 1.3724 to 1.3804. For the week, the currency was up 0.2%.. Immediate resistance can be seen at 1.3780 (SMA 5), an upside break can trigger rise towards 1.3810 (23.6%fib).On the downside, immediate support is seen at 1.3744 (38.2%fib), a break below could take the pair towards 1.3692(23.6%fib).
USD/JPY: The dollar dipped against yen on Friday but recovered ground after reports of Israeli attack on Iran spark rush to Swiss franc and yen, stoking concerns about a potential broader regional conflict. Israel's attack on Iranian soil was the latest tit-for-tat exchange between the two arch foes, sending safe haven currencies such as the yen and Swiss franc higher and putting gold on track for its fifth week of gains. Meanwhile, Bank of Japan Governor Kazuo Ueda said on Thursday the central bank may raise interest rates again if the yen's declines significantly push up inflation, highlighting the impact currency moves may have on the timing of the next policy shift. The Japanese yen strengthened 0.02% versus the greenback at 154.63 per dollar. Strong resistance can be seen at 154.68(23.6%fib), an upside break can trigger rise towards 155.00(Psychological level).On the downside, immediate support is seen at 153.72 (5EMA), a break below could take the pair towards 152.78 (38.2%fib).
Equities Recap
European stocks closed lower on Friday, but off their over one-month intraday low, as anxiety around escalating Middle East tensions seemed to ease, while French cosmetic giant L'Oreal logged its best day since early January after robust results.
UK's benchmark FTSE 100 closed up by 0.24 percent, Germany's Dax ended down by 0.53 percent, France’s CAC finished the day up by 0.01 percent.
The Nasdaq and the S&P 500 closed sharply lower on Friday and Treasury yields dipped as investors juggled lackluster earnings, uncertainties surrounding central bank policy and geopolitical strife.
Dow Jones closed down by 0.10% percent, S&P 500 closed down by 0.61% percent, Nasdaq settled down by 1.00% percent.
Treasuries Recap
Treasury yields inched lower as investors favored safe-haven assets due to potential broadening of the Middle East conflict.
Benchmark 10-year notes last rose 6/32 in price to yield 4.6228%, from 4.647% late on Thursday.
The 30-year bond last rose 14/32 in price to yield 4.7168%, from 4.745% late on Thursday.
Commodities Recap
Gold prices rose on Friday and logged a fifth consecutive weekly rise, as fears of further tit-for-tat retaliation between Iran and Israel triggered safe-haven demand.
Spot gold was up by 0.7% at $2,395.15 per ounce as of 1:45 p.m. ET (1745 GMT), after rising as high as $2,417.59 earlier in the session. Prices were up 2.2% this week.U.S. gold futures settled 0.7% higher at $2,413.8.
Oil settled slightly higher on Friday, but posted a weekly decline, after Iran played down a reported Israeli attack on its soil, a sign that an escalation of hostilities in the Middle East might be avoided.
Brent futures settled up 18 cents, or 0.21%, at $87.29 a barrel
