Market Roundup
- USD/JPY makes fresh 8 year highs at 123.67 from 122.77.
- EUR/USD recovers to 1.0929 fm 1.0864 yday, eases to 1.0893.
- EUR/GBP off 0.7060 2-1/2 month low, eyes on Queen's speech.
- ECB does not raise emergency funding cap for Greek banks.
- U.S Tsy Sec Lew: Biggest worry is that a miscalculation could lead to a crisis in Greece.
- Lew: China's policy on FX rate has been a source of considerable concern.
- China Central Bank: Inflation outlook unstable, price levels exp to remain low.
- China Central Bank will maintain prudent monetary policy, timely fine tune.
- Danish PM calls for a national election on 18 June.
- Germany GFK Consumer sentiment 10.2 vs previous 10.1. 10.0 expected.
- Switzerland April UBS consumption indicator 1.25 vs previous 1.34.
- Japan economy min Amari: Rapid FX movements undesirable.
Economic Data Ahead
- N/A Revised Building Permits (Apr) (as-reported 1.143 mn SAAR).
- (0700 ET/1100 GMT) MBA Mortgage Application Indices.
- (0855 ET/1255 GMT) Redbook Same Store Sales Index (May 23 wk).
- (1030 ET/1430 GMT) Dallas Fed Texas Service Sector Outlook Survey (May) (previous -1.0).
- (1030 ET/1430 GMT) -- Dallas Fed Services Revenue Index (May) (previous 14.6).
Key Events Ahead
- (1000 ET/1400 GMT) BoC monetary policy announcement.
- (1145 ET/1545 GMT) FedTrade operation 30-year Fannie Mae / Freddie Mac (max $2.000 bn).
FX Recap
EUR/USD is supported around 1.0900 levels and currently trading at 1.0896 levels. It has made intraday high at 1.0927 and low at 1.0863 levels. Today Germany GKF consumer sentiment released with positive numbers. Without any releases due in Euroland and the US economy today, Greek headlines and the G7 meeting kicking in today in Dresden will grab all the attention. Initial support is seen at 1.0859 and resistance is seen around 1.1041 levels. Option expiries are at 1.0800 (839M), 1.0900 (543M), 1.0940-55 (1.5BLN), 1.1000 (1BLN).
USD/JPY broke the 123.00 levels and posted a daily high at 123.66 levels and low at 122.76 levels. Pair is currently trading at 123.45 levels. The Bank of Japan Minutes from April 30 has been released, with the statement highlighting that QQE will continue until 2% inflation is stable. Members agreed that private consumption is likely to remain resilient due to improving incomes and Japan can exceed its potential growth rate from 2015 through financial year 2016. Near term resistance is seen at 123.67 levels and support is seen at 121.35 levels. Option expiries are at 121.80 (300M), 123.00 (440M), 124.00 (450M).
GBP/USD is trading around at $1.5393. It made an intraday high at 1.5436 and low at 1.5376 levels. The pair took a breather in its downslide and is seen struggling around 1.54. Today is data free session for UK. Initial support is seen at 1.5324 and resistance is seen around 1.5471 levels. Option expiry is at 1.5315-20 (450M).
USD/CHF is supported around 0.9500 levels and trading at 0.9496 levels and made intraday low at 0.9511 and high at 0.9537 levels. Today Switzerland released UBS consumer confident data with flat numbers. Near term support is seen at 0.9285 levels and resistance is seen at 0.9571 levels.
AUD/USD is supported below 0.7800 levels and trading at 0.7718 levels. It has made intraday high at 0.7767 levels and low at 0.7714 levels. Markets also shrugged off weak Aus construction activity which fell for the sixth-consecutive period last quarter in Australia. Meanwhile, markets now shift their attention towards key Australian private capex numbers to be published tomorrow in absence of any macro data from US due today. Initial support is seen at 0.7700 and resistance at 0.7845 levels. Option expiries are at 0.7750 (366M), 0.7800 (644M), 0.7815-20 (500M).
