Market Roundup
- Fed sees no rate hikes in 2019, sets end to asset runoff
- EU readies short Brexit delay - if May wins parliament over
- May urges parliament to back her on Brexit, tells Britons "I'm on your side"
- Trump says tariffs on Chinese goods may stay for 'substantial period'
- Australia Feb Employment, 4.6k, 14.0k f'cast, 39.1k prev
- Australia Feb Unemployment Rate, 4.9%, 5.0% f'cast, 5.0% prev
- New Zealand Q4 GDP Prod Based YY, SA, 2.3%, 2.5% f'cast, 2.6% prev
- New Zealand Q4 GDP Exp Based QQ, SA, 0.5%, 0.6% f'cast, 0.5% prev
Economic Data Ahead
- (0530 ET/0930 GMT) Great Britain Feb Retail Sales MM, -0.4% f'cast, 1.0% prev
- (0530 ET/0930 GMT) Great Britain Feb Retail Sales YY, 3.3 % f'cast, 4.2% prev
- (0800 ET/1200 GMT) Great Britain Mar BOE Bank Rate,0.75% f'cast, 0.75% prev
- (0800 ET/1200 GMT) Great Britain Mar BOE QE Gilts, 435 bln f'cast, 435 bln prev
- (0800 ET/1200 GMT) Great Britain Mar BOE QE Corp, 10 bln f'cast, 10 bln prev
Key Events Ahead
- N/A General Council meeting of the ECB in Frankfurt
- (0400 ET/0800 GMT) ECB supervisor Andrea Enria presents the ECB Annual Report on supervisory activities 2018 in Brussels
- (0800 ET/1200 GMT) BoE announces rate decision in London
FX Beat
DXY: The dollar index consolidated near a 6-1/2 week trough after Fed policymakers said the central bank's benchmark overnight interest rate was likely to remain at the current level of between 2.25 percent and 2.50 percent at least through this year. The greenback against a basket of currencies traded flat at 95.94, having touched a low of 95.74 on Wednesday, its lowest since Feb 4. FxWirePro's Hourly Dollar Strength Index stood at -65.38 (Bearish) by 0500 GMT.
EUR/USD: The euro rallied towards a 1-1/2 month peak recorded in the previous session, as the greenback declined after the U.S. Federal Reserve took a more accommodative stance at its policy meeting. The European currency traded 0.1 percent up at 1.1420, having touched a high of 1.1448 on Wednesday, its highest since Feb. 4. FxWirePro's Hourly Euro Strength Index stood at 21.02 (Neutral) by 0500 GMT. Investors’ attention will remain on ECB economic bulletin, ahead of the U.S. unemployment benefit claims. Immediate resistance is located at 1.1460, a break above targets 1.1408 (Feb 4 High). On the downside, support is seen at 1.1370 (Jan. 17 Low), a break below could drag it till 1.1336 (Jan. 22 Low).
USD/JPY: The dollar plunged to a 3-week low after the U.S. Federal Reserve abandoned projections for any interest rate hikes this year amid signs of an economic slowdown. The major was trading 0.1 percent down at 110.54, having hit a low of 110.40 earlier, its lowest since Feb. 27. FxWirePro's Hourly Yen Strength Index stood at 29.68 (Neutral) by 0500 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. unemployment benefit claims. Immediate resistance is located at 110.95 (Feb. 20 High), a break above targets 111.23 (Feb. 25 High). On the downside, support is seen at 110.25 (Feb. 15 Low), a break below could take it lower at 109.63 (Dec. 31 Low).
GBP/USD: Sterling rebounded from a 1-week low after British Prime Minister Theresa May asked the European Union to delay Brexit until June 30. The major traded 0.2 percent up at 1.3214, having hit a low of 1.3146 on Wednesday; it’s lowest since Mar. 13. FxWirePro's Hourly Sterling Strength Index stood at -99.30 (Slightly Bearish) 0500 GMT. Investors’ will remain on UK retail sales, public sector net borrowing and Bank of England policy decision, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3254 (Mar. 4 High), a break above could take it near 1.3288 (Mar. 12 High). On the downside, support is seen at 1.3146 (Mar. 20 Low), a break below targets 1.3097 (Mar. 5 Low). Against the euro, the pound was trading 0.05 percent up at 86.44 pence, having hit a low of 86.66 on Wednesday, it’s lowest since March 11.
AUD/USD: The Australian dollar advanced to a 3-week peak on data that showed domestic unemployment rate fell to a near 8-year low in February, triggering expectations the country's central bank won't cut interest rates any time soon. The Aussie trades 0.4 percent up at 0.7144, having hit a high of 0.7168, it’s highest since Feb. 27. FxWirePro's Hourly Aussie Strength Index stood at -15.13 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7090 (Feb. 28 Low), a break below targets 0.7041 (Mar. 14 Low). On the upside, resistance is located at 0.7182 (Feb. 20 High), a break above could take it near 0.7198 (Feb. 27 High).
NZD/USD: The New Zealand dollar climbed to a 7-week high after data showed NZ economic growth picked up to 0.6 percent in the December quarter, boosted by strength in household consumption, construction and business investment. The Kiwi trades 0.5 percent up at 0.6917, having touched a high of 0.6938, its highest level Feb. 1. FxWirePro's Hourly Kiwi Strength Index was at 103.33 (Highly Bullish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6944 (Dec. 5 High), a break above could take it near 0.6969 (Dec. 4 High). On the downside, support is seen at 0.6808 (Mar. 14 Low), a break below could drag it below 0.6757 (Feb. 22 Low).
Equities Recap
Asian shares rallied after the U.S. Federal Reserve took a more accommodative stance at its policy meeting, however, concerns over slowing global growth limited upside.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.4 percent.
Australia's S&P/ASX 200 index gained 0.05 percent to 6,167.20 points and South Korea's KOSPI surged 0.4 percent to 2,186.23 points.
Shanghai composite index rose 0.8 percent to 3,115.48 points, while CSI300 index traded 0.4 percent up at 3,850.70 points.
Hong Kong’s Hang Seng traded 0.2 percent lower at 29,255.14 points. Taiwan shares added 0.5 percent to 10,609.44 points
Commodities Recap
Crude oil prices rallied to an over 4-month peak, boosted by supply cuts led by producer cartel OPEC and U.S. sanctions against Iran and Venezuela. However, fears of slowing global economy capped further gains. International benchmark Brent crude was trading 0.6 percent up at $68.59 per barrel by 0447 GMT, having hit a high of $68.61 earlier, its highest since Nov. 13. U.S. West Texas Intermediate was trading 0.4 percent higher at $60.22 a barrel, after rising as high as $60.24, its highest since the Nov. 12.
Gold prices rose to a 3-week peak after the U.S. Federal Reserve ruled out a possibility of an interest rate hike this year. Spot gold gained 0.5 percent at $1,318.75 per ounce by 0500 GMT, having touched a high of $1,318.93, its highest since Feb 28. U.S. gold futures rose 1.1 percent to $1,316.10 an ounce.
Treasuries Recap
The Australian government bond futures turned mixed, with the three-year bond contract off 1 tick at 98.550. The 10-year contract was still up 3 ticks at 98.0900.
The New Zealand yields were 3 to 4 basis points lower.
The Canadian government bond prices were higher across the yield curve. The two-year rose 8.5 Canadian cents to yield 1.602 percent and the 10-year climbed 53 Canadian cents to yield 1.667 percent, its lowest since June 2017.
