Global Markets:

  • China FDI – Foreign Direct Investment (YTD) (MAR) (y/y): 5.0%, Previous: 5.5%
  • NZ Finance Minister English says $NZD is a bit high
  • NZ Finance Minister English says RBNZ has used threat of currency intervention, but New Zealand doesn’t have hundreds of billions to influence FX
  • NZ Finance Minister English says high dollar makes it difficult to re-balance the economy
  • Asian stock markets are mostly lower this morning with the Nikkei down 2 % and the Shanghai Composite losing 0.30 %
  • Australia’s ASX and the Hang Seng both fell 0.60 % on the day
  • Gold at $1297 (+0.30 %), Silver at $19.51 (+0.20 %), Crude Oil at $101.91 (+0.40 %)
  • US 10 year yield at 2.495

FX Flows/Orders:

  • AUD – AUD/USD briefly dipped sub-0.9350 driven by selling from US bank names, but local exporters were noted buyers. Dealers are reporting bids at 0.9320/25 and large stops building below, but they expect the weekly range to hold in the near-term. We saw some further liquidation of AUD/JPY long positions from speculators; there are sizeable trailing stops beneath 94.50 and the 55DMA at 94.41.
  • CAD – Not much to report about USD/CAD. Locals saw selling from offshore accounts and note that there are bids in the mid-1.0850’s + better demand towards the 1.08 barrier option. Offers in front of 1.0920 and large stops just above, but further consolidation within 1.0850-1.0920 in the coming few sessions the most likely scenario.
  • EUR – Back above 1.37 on general USD strength and capitulation of short-term specs who were caught short near the lows. Banks see better selling interest towards 1.3750 and one source notes there is supply from Asian sovereign names as well. On the crosses, EUR/GBP is at 0.8168 and there are solid offers at 0.8180, while EUR/JPY is likely to test key tech support at 138.50 soon.  No important data releases out of the Euro Zone this morning, it should stay fairly quiet until the US data releases.
  • GBP – Like in the Euro, short-term specs were caught short the Pound in yesterday’s early NY session. Cable was briefly above 1.68, but failed to sustain momentum. It looks like the market wants to test the topside stops, so we could see a move higher in the upcoming London session. Initial resistance at the 21 DMA at 1.6838, then not much until 1.6880.
  • JPY – Dealers in Tokyo expect the 101.25-75 range to hold today, noting solid demand from semi-official names around 101.25 and decent offers towards 101.80.

Upcoming Events:

  • 12:30 GMT – US Building Permits (1.015M)
  • 12:30 GMT – US Housing Starts (0.98M)
  • 13:55 GMT – Michigan Consumer Expectations (75.0)
  • 13:55 GMT – Michigan Consumer Sentiment (84.5)