Market Roundup
- Canada BoC Rate Decision: cuts 0.25% to 0.5%, f/c 50/50 on cut.
- BoC says QE is in its toolkit as rates approach zero bound.
- BoC revises growth lower, reflecting lower business investment plans in energy sector.
- BoC's Poloz: US & Canadian economies less likely to be synchronized than in past, because Canada is dealing with terms-of-trade shock.
- Fed's Yellen: appropriate to raise rates in '15 if econ evolves as expected, econ can tolerate & needs them.
- Fed's Yellen high degree of monetary accommodation remains appropriate.
- Fed's Williams says this is the year for rate liftoff.
- Fed Monetary policy report: Credit market reflects some signs of reach for yield behavior.
- New Zealand's Fonterra Dairy prices fall, volumes drop at auction.
- UK's Cameron backs IMF call for Greek debt relief, says it is not for Britain to bail out a EZ country.
- German finance ministry: Extending Greek debt maturities technically an option.
- Greek protesters clash with police at anti-austerity march.
- IMF says German economy benefiting from weaker euro & lower energy prices.
- US PPI Final Demand YY Jun -0.7%, f/c -0.9%, -1.1%-previous.
- US PPI ex-Food/Energy MM Jun 0.3%, f/c 0.1%, 0.1%-previous.
- US Industrial Output MM Jun 0.3%, f/c 0.2%, -0.2%-previous.
- US Capacity Utilization MM Jun 78.4%, f/c 78.1%, 78.2%-previous.
Looking Ahead - Economic Data (GMT)
- 23:50 Japan Foreign Bond Investment w/e 205.2b-previous
- 23:50 Japan Foreign Invest JP Stock w/e -185.4b-previous
- 22:35 New Zealand Manufacturing PMI* Jun 51.5-previous
- 22:45 New Zealand CPI QQ* Q2 f/c 0.6%,-0.3%-previous
- 22:45 New Zealand CPI YY* Q2 f/c 0.4%, 0.1%-previous
Looking Ahead - Events, Other Releases (GMT)
No Significant Events
Currency Summaries
EUR/USD
EUR/USD is supported around 1.0915 levels and currently trading at 1.0949 levels. It has made session high at 1.1035 and low at 1.0927 levels. The pair started to fall from 1.1036 levels in the early US session,it continued its bearish momentum after US PPI printed 04% against the forecast of 0.2%. It was the second time in two months PPI printed positive figures. Dollar further strengthened after Chair Yellen's Semi-annual testimonial. The pair's bearish momentum broke support level at 1. 0972 (23.6% retracement level) and hit daily lows at 1.0926. Ahead of crucial voting for third bailout, Greece deputy finance minister resigned from left wing party, explaining, austerity measures demanded for third bailout would put the country in difficult path. To the upside, immediate resistance can be seen at 1.1060. To the downside, major support level is located at 1.0915.
GBP/USD
GBP/USD is supported around 1.5542 levels and currently trading at 1.5631 levels. It has made session high at 1.5673 and low at 1.5578 levels. The cable fell from 1.5636 level, towards 1.5576 levels after, UK Average Earnings Index printed 3.2% against 3.3% and Claimant Count Change printed 7.0k against -8.8k ,as both the important data printed negative figures, the cable more or less remained in the same level by refusing to moving downwards much. The cable started to move downwards only after US PPI printed positive figures against the forecast and more importantly after release of Yellen's Semi-annual testimonial text to congress. To the upside, immediate resistance can be seen at 1.5678. To the downside, major support level is located at 1.5544. Overall trend of this pair is bearish, but this pair should be traded with caution due to political events ahead in the coming days.
USD/CHF
USD/CHF is supported around 0.9505 levels and currently trading at 0.9522 levels. It has made session high at 0.9548 and low at 0.9511 levels. The pair resumed its bullish momentum by breaking resistance level at 0.9504 (38.2% retracement level) followed by resistance level at 0.9520 (23.6% retracement level) and reached daily high at 0.9544. After the US PPI figures printed positive, the pair broke resistance level at 0.9505. The Dollar bullish sentiment was further fueled by Yeller's Semi-annual testimonial to congress. Yellen said , Fed will likely hike interest rates this year, If US economy expands as it is expected. To the upside, immediate resistance can be seen at 0.9550. To the downside, major support level is located at 1.5505.
USD/CAD
USD/CAD is supported around 1.2880 levels and currently trading at 1.2914 levels. It has made session high at 1.5955 and low at 1.2911 levels. The loonie was generally weaker against Dollar, due to broader Dollar demand amid Greece crisis and falling oil prices. The pair was trading in the range of 1.2780 levels in the early US sessions. The pair gained some momentum after US released PPI figures, but the pairs real shot in the arm came, after Bank of Canada (Boc) revised its interest rate by cutting 25bps from 0.75% to 0.50%. This was second revision in interest rate by Bank of Canada. The pair surged from 1.2880 levels to 1.2960 levels almost gaining 180pips to hit 6-year high before retreating towards1.2908 level. The pair is all set to breach psychological in the coming days, last time this level was breached was way back in 2008. To the upside, immediate resistance can be seen at 1.2960 (July 16th high). To the downside, major support level is located at 1.2880 levels.
