Market Roundup
- German FinMin Schaeuble: Greece must stick to agreements, help only if it toes line, can't rule out "Grexident".
- NY Fed: FX swaps with foreign CBs $2 mln March 11 week, all with BoJ.
- BOE Governor: BOE rate-setters should consider sterling's strength might persist; the strength of sterling could weigh on prices for some time.
- BoJ Gov Kuroda: CPI to rise with wages and inflationary expectations.
- BOJ officials: If low oil costs keep inflation subdued for too long, households may start to feel that Japan will never see inflation hit 2 pct.
- Japan FinMin Aso: Cheap oil-weak JPY-low interest rates combination good for Japanese economy now.
- Foreign CB US debt holdings -$18.682 bln to $3.234 trln March 11 week, Treasury holdings -$18.635 bln to $2.906 trln, agencies -$222 mln to $284.553 bln.
- New Zealand Feb BNZ/BNZ PMI 55.9, Jan revised down to 50.7.
- Japan Jan Industrial Output revised decrease to +3.7 % vs previous 4.0 %.
- Japan Jan Capacity Util Index change mm increase to +3.6 % vs previous 2.0 %.
Economic Data Ahead
- (0500 EDT/0900 GMT) Italy Feb CPI final, +0.3% m/m, -0.2% y/y consensus; flash +0.3%, -0.2%.
- (0500 EDT/0900 GMT) Italy Feb HICP final, +0.3% m/m, +0.1% y/y consensus; flash +0.3%, +0.1%.
- (0530 EDT/0930 GMT) UK Jan construction output, +1.2% m/m, +2.2% y/y consensus; previous +0.4%, +5.5%.
- (0830 EDT/1230 GMT) US Feb PPI final demand, +0.3% m/m,unchanged y/y consensus; previous -0.8%,unchanged.
- (0830 EDT/1230 GMT)US Feb PPI ex-food/energy, +0.1% m/m, +1.6% y/y consensus; previous -0.1%, +1.6%.
- (1000 EDT/1400 GMT) US Mar U.Mich sentiment index prelim, 95.5 consensus; previous 95.4.
Key Events Ahead
- N/A UK DMO 1-month Treasury bill auction.
- (0500 EDT/0900 GMT) BoE MPC Shafik speech at London symposium.
- (1030 EDT/1430 GMT) ECD/BdF Noyer speech at Paris conference.
- (1115 ECT/1515 GMT) BoE ChiefEcon Haldane speech at New York conference.
FX Recap
EUR/USD: Dollar weakened against the euro which climbed up to $1.0633, from a 12-year trough of $1.0494. However, bias remains with bears and the pair is likely to fall over 2 percent this week. EUR/USD was slightly boosted by a bounce in some euro zone government bond yields, which slumped to record lows this week as the ECB started its quantitative easing program. Resistance is seen at 1.0700 levels and support at 1.0494 levels.
USD/JPY currently trades at 121.37 levels, having posted a high of 121.46 and a low of 121.27. The pair sees strong resistance at 122.00 levels which it touched momentarily earlier this week. Any break above this level could push the pair to 122.50 levels. On the downside, it is likely to find support at 120.397 levels.
AUD/USD reverted from the highs of 0.7707 levels seen in the previous session and now trades in the red in the mid-Asian trading. It currently trades at 0.7687 levels. On the upside, resistance is located at 0.7707 (Today's High) levels, above which it could extend gains to 0.7730 levels. On the downside, support is located at 0.7662 (5-DMA) levels and then at 0.7600 levels.
NZD/USD hit a one-week high of 0.7450 on Thursday as the RBNZ left the interest rate unchanged. On Friday, it reversed the previous gains and turned negative. It currently trades at 0.7364 levels. It is likely to find support at 0.7340 levels and resistance at 0.7450 levels.
USD/CNY continued choppy trade in the thin 6.2586-6.2659 range seen this week. Prior to market open, the PBOC set the mid-point rate firmer than the previous fix, owning to the easing greenback in global markets overnight. By late morning, the spot yuan was trading at 6.2590 per dollar.
