Europe Round up Usd on Defensive As Treasury Yields Ease; Gbp Hits 1-Month Low Vs Eur – June 9th, 2015

Market Roundup

  • Dollar index off 94.845 lows, 95.454 recovery high.
  • USD/JPY off Friday’s 125.86 13 year high, 124.74-124.06 range on the day.
  • Sterling slips to 1 month low vs euro. EUR/GBP hits 0.73895.
  • EUR/USD rise limited to 1.1347 as Greek concerns weigh. 1.1249 p/back low.
  • Euro Zone official- EU commission has received New Greek reform proposal, now assessing.
  • Euro Zone Q1 GDP revised 0.4% q/q, 1.0% q/q vs previous 0.4%/1.0%. 0.4%/1.0% expected.
  • UK April Global goods balance -8.561 bln vs previous -10.70bln revised -9.9bln expected.
  • UK April Total goods/services trade balance -1.202bln vs previous -3.429 bln revised. -3.0bln expected.
  • UK May BRC Retail sales 0.0% vs previous -2.4%.
  • Switzerland CPI +0.2% m/m, -1.2% y/y vs previous -0.2%/-1.1%. 0.1%/-1.2% expected.
  • Switzerland May Unemployment rate unadjusted 3.2% vs previous 3.3%. Adjusted 3.3% vs previous 3.3%.
  • HSBC will rebrand UK retail bank, says to cut up to 8,000 UK jobs.

Economic Data Ahead

  • (0855 ET/1255 GMT) US Redbook Same-Store Sales Index.
  • (0900 ET/1300 GMT) US NFIB Small Business Optimism Index (May) previous 96.9.
  • (1000 ET/1400 GMT) US Wholesale Inventories (April) consensus +0.1% m/m, previous +0.1% m/m.
  • (1000 ET/1400 GMT) US Wholesale Sales (Apr) previous -0.2% m/m.
  • (1000 ET/1400 GMT) US JOLTS Job Openings Level previous 4.994 m/m.

Key Events Ahead

  • (1000 ET/1400 GMT) ECB Nouy speech at Berlin conference.
  • (1145 ET/1545 GMT) Fed Trade operation 15-yr Fannie Mae/Freddie Mac (max $700 mn).

FX Recap

EUR/USD is supported below 1.1300 levels and currently trading at 1.1260 levels. It has made intraday high at 1.1344 and low at 1.1247 levels. U.S. two-year Treasury yields having fallen back towards pre-jobs data levels, indications are the rates markets were having a hard time factoring in a Federal Reserve rate hike later this year. As a result, the spread over German two-year Bund yields narrowed, all of which kept the dollar under pressure and helped the euro. Meanwhile, the pair ignored in line with estimates Euro zone Q1 GDP print as markets now focus on US JOLTS openings data for further momentum. Initial support is seen at 1.1257 and resistance is seen around 1.1380 levels. Option expiries are at 1.1250 (454M), 1.1280-85 (520M), 1.1300 (217M), 1.1325 (436M), 1.1350 (777M).USD/JPY is supported around 124.00 levels and posted a high of 124.72 levels. It has made intraday low at 123.91 and currently trading at 123.96 levels. The pair witnessed a sudden sell-off sparked by renewed weakness in the greenback across the board. The US dollar index, measuring the relative strength of the greenback against a basket of six major currencies turned in red at 95.19, retreating from fresh session highs at 95.47. Moreover, the major remains pressured as the yen supported on Japan’s Prime Minister Abe’s optimistic comments overnight that weaker yen was leading to more visitors to Japan and supporting companies doing business overseas. Near term resistance is seen at 124.74 and support is seen at 123.85 levels. Option expiries are at 124.00 (972M), 125.25 (530M).GBP/USD is supported around $1.5300 levels. It made an intraday high at 1.5372 and low at 1.5271 levels. Pair is currently trading at 1.5301 levels. Sterling slipped to a one-month low against the euro on Tuesday, extending a two-week losing streak despite data showing Britain’s trade deficit narrowed to its lowest in over a year in .895 pence. Initial support is seen at 1.5189 and resistance is seen around 1.5368 levels. Option expiries are at 1.5225 (360M), 1.5350 (390M).USD/CHF is supported below 0.9300 levels and trading at 0.9280 levels and made intraday low at 0.9245 and high at 0.9296 levels. Today Switzerland released Unemployment rate with flat numbers and CPI data with positive numbers. Near term support is seen at 0.9242 levels and resistance is seen at 0.9372 levels.AUD/USD is supported above 0.7650 levels and trading at 0.7682 levels. It has made intraday high at 0.7721 levels and low at 0.7645 levels. The Aussie keeps red as traders ignored Aus improved business conditions reading as China softer price pressures print weighed heavily on markets. Chinese inflation ticked down to 1.2% y/y in May, coming in slightly weaker than the forecast pace of 1.3%, and easing from April’s 1.5% rise. While, the Aussie shrugged off upbeat business confidence data from Australia which revealed that the NAB Business Confidence Index jolted up to 7 in May from 3 in April, while the NAB Business Conditions Index rose to 7 from 4. Initial support is seen at 0.7568 and resistance at 0.7739 levels.

The material has been provided by InstaForex Company – www.instaforex.com

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