Market Roundup
- Japan Post to increase investment risk after listing.
- FinMin Aso - Monetary policy alone can't boost economy, "third arrow" and fiscal policy equally important, progress in beating deflation.
- ECB wouldn't cut ELA if Greece misses IMF payment.
- Greek FinMin Varoufakis - Very close to deal with EU/IMF, return to drachma not on radar, hope to pay both IMF and wages-pensions in June.
- RBA May 5 minutes - May-June cut discussed, statement wouldn't include forward guidance, better communicated via SOMP, won't limit scope for action, lower AUD both likely and necessary, growth below trend, China growth slower.
- RBNZ inflation survey - Expectations perk up in Q2, 1-yr 1.32%, 2-yrs 1.85% and previous survey +1.11%.
- NZ Q1 PPI inputs -1.1% q/q, outputs -0.9%, -0.7% and +0.1% eyed.
- NZ April job ads -0.2% m/m, +3.5% y/y, newspapers +5.5% and -3%, internet -0.9% and +0.9%.
Economic Data Ahead
- (0430 ET/0830 GMT) UK April CPI, +0.4% m/m, unchanged y/y expected; last +0.2%, unchanged.
- (0430 ET/0830 GMT) UK April RPI, +0.4% m/m, +1.0% y/y expected; last +0.2%, +0.9%.
- (0430 ET/0830 GMT) UK April RPIX, +0.4% m/m, +0.9% y/y expected; last +0.2%, +0.9%.
- (0430 ET/0830 GMT) UK April PPI - output, +0.2% m/m, -1.6% y/y expected; last +0.2%, -1.7%.
- (0430 ET/0830 GMT) UK April - core output, unchanged m/m, +0.1% y/y expected; last unchanged, +0.1%.
- (0430 ET/0830 GMT) UK April Apr PPI - input, +0.8% m/m, -11.5% y/y expected; last +0.3%, -13.0%.
- (0500 ET/0900 GMT) Germany May ZEW economic sentiment index, 49.0 expected; last 53.3.
- (0500 ET/0900 GMT) Germany May ZEW current conditions index, 69.5 expected; last 70.2.
- (0500 ET/0900 GMT) Euro Zone March trade balance, E22.3 bln surplus expected; last E20.3 bln surplus.
- (0500 ET/0900 GMT) Euro Zone April inflation - final, +0.2% m/m, unch y/y expected; flash +1.1%, unchanged.
- (0500 ET/0900 GMT) Euro Zone April - ex-food/energy, +0.3% m/m, +0.6% y/y expected; flash +1.2%, +0.6%.
- (0830 ET/1230 GMT) US April housing starts, 1.02 mln AR expected; last 930k, +2.0% m/m.
- (0830 ET/1230 GMT) US April building permits, 1.07 mln AR expected; last 1.04 mln, -5.4% m/m.
Key Events Ahead
- N/A Munich conference on growth-policy-reform, various speakers (till tom).
- N/A ESM E1.5 bln 6-month, Spain 3/9-month bill auctions.
- (0300 ET/0700 GMT) ECB/BdF Noyer speech at Paris Euromoney conference.
- (0330 ET/0730 GMT) BoE DepGov Bailey speech at London ICAS event.
- (0530 ET/0930 GMT) ECB 7-day refi at fixed 0.05%, E90 bln allotment eyed, last bln.
- N/A Bretton Woods Committee Washington, DC annual meeting, various speakers.
- (0815 ET/1215 GMT) Buba Dombret speech in Frankfurt.
- (0900 ET/1300 GMT) Canada FinMin Oliver speech in Toronto.
- (1130 ET/1530 GMT) BoC Gov Poloz speech on Prince Edward Island, press conference to follow.
- (1200ET/1600 GMT) SNB Danthine speech in Geneva.
- (1200 ET/1600 GMT) Austria FinMin Schelling, ECB/ACB Nowotny in Vienna panel discussion.
- (1430 ET/1830 GMT) Washington FSOC meeting, US TsySec Lew and FOMC Chair Yellen to attend.
FX Recap
EUR/USD broke 1.1300 levels and made a new intraday low at 1.1285 levels. It is currently trading around 1.1300 levels. The pair has broken intraday major support 1.1324 and this confirms short term weakness, a decline till 1.1218 cannot be ruled out. Today Germany ZEW economic sentiment as well as Euro zone CPI data will be main focus. 1.1370 is an immediate resistance and if that holds we may see a short dip. Initial support is seen around 1.1218 levels.
USD/JPY is trading higher at 119.94, having posted a daily high at 120.03 levels and low at 119.85 levels. Today is data free session for JPY. On the top side, the next resistance is located at 120.30 (May 1 High) levels and above which it could extend gains 120.54 (May 5 High) levels. Immediate support might be located at 118.85 levels.
GBP/USD is slipped below 1.5700 levels and trading around 1.5653 levels. It made intraday high at 1.5662 and low at 1.5631 levels. Today is important day for UK as UK will release CPI as well core CPI number which give further direction to the parity. Pair has an immediate resistance at 1.5737 above which gains could be extended to 1.5800 levels. On the other side, support is seen at 1.5551 levels.
USD/CHF is trading above 0.9200 levels and made intraday low at 0.9257 and high at 0.9270 levels. CHF depreciated after negative retail sales data as well as SNB board member Zurbruegg told in newspaper interview Swiss Franc still greatly overvalued against the euro. Today is data free session for CHF. Near term support is seen at 0.9070 levels and resistance is seen at 0.9293 levels.
AUD/USD is supported below 0.8000 levels and trading around 0.7990 levels. It has made intraday high at 0.8000 levels and low at 0.7956 levels. Today AUD$ released monetary policy meeting minutes. It suggested that further interest rate cuts are still on the table, even after the bank lowered the cash rate to a record-low 2% at the May meeting. Initial support is seen at 0.8044 and resistance at 0.7866 levels.
