Friday 28th April: European Open Briefing

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Friday 28th April: European Open Briefing 1

Global Markets:

  • Asian stock markets: Nikkei down 0.20 %, Shanghai Composite fell 0.35 %, Hang Seng declined 0.40 %, ASX 200 lost 0.15 %
  • Commodities: Gold at $1266.30 (+0.05 %), Silver at $17.37 (+0.20 %), WTI Oil at $49.40 (+0.90 %), Brent Oil at $52.20 (+0.80 %)
  • Rates: US 10 year yield at 2.29, UK 10 year yield at 1.06, German 10 year yield at 0.30

News & Data:

  • Japan Mar National CPI (YoY): 0.2% Est. 0.3%
  • Japan Mar National CPI Ex-Fresh Food (YoY): 0.2% Est. 0.2%
  • Japan Mar Unemployment Rate: 2.8% Est. 2.90%
  • Japan Mar Job/Applications Ratio: 1.45 Est. 1.43
  • Japan Mar P Industrial Production (MoM): -2.1% Est. -0.80%
  • Japan Mar P Industrial Production (YoY): 3.3% Est. 3.90%
  • Japan Mar Retail Sales (MoM): 0.2% Est. -0.30%
  • Japan Mar Retail Sales (YoY): 2.1% Est. 0.5%
  • Australia Q1 PPI (YoY): 1.3%
  • Australia Q1 PPI (QoQ): 0.5%
  • New Zealand March Trade Balance NZD (MoM): 332m Est. 370m
  • New Zealand March Trade Balance NZD (YoY): -3.67bn Est. -3.706bn
  • New Zealand March Exports NZD (MoM): 4.65bn Est. 4.66bn
  • New Zealand March Exports NZD (YoY): 4.31bn Est. 4.016bn
  • New Zealand March Building Permits (MoM): 1.8%
  • South Korea March Industrial Production (MoM): 1.5% Est. 1.5%
  • South Korea March Industrial Production (YoY): 3.0% Est. 4%
  • South Korea May Business Survey Manufacturing: 84
  • South Korea May Business Survey Non-Manufacturing: 78

Markets Update:

The ECB kept rates and their QE programme unchanged, as expected by the market, but maintained their easing bias. This put the Euro under pressure again. EUR/USD fell from 1.0920 to a low of 1.0857 in Asia. Key support is now seen at 1.0780, followed by the weekend gap at 1.0730.

Meanwhile, the Pound is showing strength again, also party driven by strong cross flows (GBP buying against commodity currencies). GBP/USD broke above 1.29 resistance and should test 1.30 soon. Further gains beyond that seem likely in the near-term.

The USD/JPY rally has paused. Overnight, the pair consolidated in a 111.10-35 range. Should it break below 111 support, a retest of 110 seems likely. Overall, the downtrend is still alive, and the technical outlook for the pair negative.

NZD/USD is under a lot of pressure. It broke below key support at 0.6860, which suggests that losses will extend to at least 0.6670 in the near-term.

Upcoming Events:

  • 06:30 GMT – French GDP
  • 07:00 GMT – German Retail Sales
  • 07:45 GMT – French CPI
  • 09:00 GMT – SNB Chairman Jordan speaks
  • 09:30 GMT – UK GDP
  • 10:00 GMT – Euro Zone CPI
  • 13:30 GMT – US GDP
  • 13:30 GMT – Canadian GDP
  • 15:00 GMT – US Michigan Consumer Sentiment
  • 14:45 GMT – US Chicago PMI

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