Market Roundup
• US Apr CPI, n.s.a (MoM) 0.82%, 0.71% previous.
• US Apr CPI Index, s.a 266.83, 264.79 previous.
• US Apr Core CPI Index 273.70, 271.21 previous.
• US Apr CPI (MoM) 0.8%,0.2%forecast, 0.2%forecast
• US Apr Core CPI (YoY) 3.0%,2.3% forecast, 1.6% forecast
• US Apr Core CPI (MoM) 0.9%,0.3% forecast, 0.3% forecast
• US Apr Real Earnings (MoM) 0.2%,0.1% forecast
• US Crude Oil Inventories-0.427M,-2.817M forecast,-7.990M previous
Looking Ahead - Economic Data (GMT)
•01:30 Australia Wage Price Index (QoQ) (Q1) 0.4% previous
•01:30 Australia Wage Price Index (QoQ) (Q1) 0.3%forecast, 0.6% previous
•01:30 Australia Wage Price Index (YoY) (Q1) 1.1% forecast, 1.4% previous
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro dipped against dollar on Wednesday after data showed U.S. consumer prices increased by the most in nearly 12 years in April. A 0.8% jump in the U.S. consumer price index - outpacing a 0.2% forecast boosted the U.S. dollar as expectations of rising real interest rates burnished the currency’s appeal. The dollar, gained after wobbling briefly earlier in the day.The dollar index, which measures the greenback against six major currencies, rose 0.65% to 90.795. The rising dollar left the euro 0.60% weaker at $1.208. The single currency on Tuesday had hit a 2-1/2 month high. Immediate resistance can be seen at 1.2111 (38.2%fib), an upside break can trigger rise towards 1.2169 (Higher BB).On the downside, immediate support is seen at 1.2053 (38.2%fib), a break below could take the pair towards 1.2011 (30DMA).
GBP/USD: Sterling on Wednesday as dollar strengthened after U.S. consumer prices increased more than expected in April, leading many to believe inflationary pressures could spur the Federal Reserve into tightening policy earlier than signaled. The consumer price index jumped 0.8% last month, the largest gain since June 2009. The CPI rose 0.6% in March. A 10.0% surge in prices of used cars and trucks, the most since the series started in 1953, accounted for over a third of the increase in the CPI last month. That followed a 0.5% rise in March. Immediate resistance can be seen at 1.4154 (23.6%fib), an upside break can trigger rise towards 1.4200 (Psychological level).On the downside, immediate support is seen at 1.4040 (38.2%fib), a break below could take the pair towards 1.3948 (38.2%fib).
USD/CAD: The Canadian dollar was little changed against its broadly stronger U.S. counterpart on Wednesday, holding near an earlier six-year high as investors bet that the Bank of Canada would be more sensitive to rising inflation than the Federal Reserve. The U.S. dollar rallied against a basket of major currencies as data showed U.S. consumer prices increasing by the most in nearly 12 years in April. The Canadian dollar was trading nearly unchanged at 1.2100 to the greenback, or 82.64 U.S. cents, having touched its strongest level since May 2015 at 1.2046. It gained ground against the other G10 currencies. Immediate resistance can be seen at 1.2176(9DMA), an upside break can trigger rise towards 1.22549 (38.2%fib).On the downside, immediate support is seen at 1.2040 (23.6%fib), a break below could take the pair towards 1.2000 (Psychological level).
USD/JPY: The dollar edged higher the yen on Wednesday after inflation data showed a surge in consumer prices in April. The Labor Department report on Wednesday showed U.S. consumer prices increased more than expected as booming demand in the reopening economy pushed against supply constraints. The consumer price index jumped 0.8% last month versus the 0.2% forecast. The Fed has argued that while inflation is rising, it is likely temporary and will dip again by the end of the year. The dollar was trading up 0.01% on the yen at 109.61. Strong resistance can be seen at 109.80 (23.6%fib), an upside break can trigger rise towards 110.39(29th March high).On the downside, immediate support is seen at 109.31 (38.2%fib), a break below could take the pair towards 108.93 (50%fib).
Equities Recap
European stocks rose on Wednesday, led by a charge in energy shares as oil prices hit two-year highs, while strong regional earnings reports and signs of speedy economic recovery offset concerns about a rapid rise in U.S. prices.
UK's benchmark FTSE 100 closed up by 0.20 percent, Germany's Dax ended up by 0.82 percent, France’s CAC finished the day up by 0.19 percent.
U.S. stocks suffered the biggest slump in at least 11 weeks on Wednesday and benchmark Treasury yields jumped after data showed consumer prices in April unexpectedly rose by the highest level in nearly 12 years, prompting bets on earlier interest rate hikes.
Dow Jones was ended down by 1.99 percent, S&P 500 ended lower by 2.15 percent, Nasdaq ended down by 2.67 percent.
Commodities Recap
Gold fell 1% in choppy trading on Wednesday, en route to snap a five-session-long winning streak, after April’s jump in U.S. consumer prices buoyed the dollar and U.S. Treasury yields, reducing appetite for non-yielding bullion.
Spot gold fell 0.8% to $1,822.91 per ounce by 1:51 p.m. EDT (1751 GMT) after falling up to 1% earlier in the session.U.S. gold futures settled down 0.7% at $1,822.80.
Oil prices rose to an eight-week high on Wednesday as U.S. crude exports plunged and on signs of a speedy economic recovery and upbeat forecasts for energy demand.
Brent futures rose 77 cents, or 1.1%, to settle at $69.32 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 80 cents, or 1.2%, to settle at $66.08.
