globicus.com

Wed07232014

Last update07:43:00 PM

Error
  • Error loading feed data.
Back Currencies Reports and Strategy New UK PM Boosts Sterling

New UK PM Boosts Sterling

·                The dollar traded mixed on Tuesday. Investors worried about rising Chinese inflation and that the EU bailout package will not halt the Greek contagion risk. US small business optimism and wholesale inventories increased more than expected. The yen rose as equity prices fell. The S&P 500 declined 3.94 to 1,155.79. The euro fell for the first day in three on worries European high-debt countries will struggle to contain deficits. The Australian dollar depreciated on concerns China will tighten its monetary stance amid accelerating Chinese inflation. The Canadian dollar was little changed at the 1.02 support.

·                The GBP/USD rose after UK PM Gordon Brown said he will resign, paving the way for Conservative leader David Cameron to succeed him. Cameron accepted the Queen’s invitation to form Britain’s next government, which will be a coalition government with the Liberal Democrats. The GBP/USD was also supported by stronger-than-expected UK manufacturing output and home prices. The pair remains in a clearly defined downtrend. Resistances are in the 1.50 and 1.53 areas. There is support in the 1.48 area. If the resistance from this year’s downtrend is broken, the GBP/USD outlook will improve.

Financial and Economic News and Comments

US & Canada  

·                The US NFIB small business optimism index increased to a higher-than-expected 90.6 in April from 86.8 in March, indicating US small business optimism improved last month and ending seven consecutive quarters of below 90 readings, according to data from the National Federation of Independent Business. The sales expectations measure increased to 6 in April from -3 the prior month.

·                US wholesale inventories were up a slightly more-than-expected 0.4% m/m to $394.8 billion in March, a third consecutive monthly increase, after a 0.6% m/m advance in February, figures from the Commerce Department showed, signaling sustainable US economic growth. Wholesale sales rose 2.4% m/m to $348.0 billion, a 12th straight monthly gain, following February’s upwardly revised 1.2% m/m rise. The inventories/sales ratio declined to 1.13 in March from 1.16 the prior month, compared with March 2009’s 1.39. Inventories fell 5.3% y/y in March while sales rose 15.8% y/y.

Europe

·                Germany’s consumer prices slipped 0.1% m/m in April, the first month-on-month decline in three months, after a 0.5% m/m increase in March, final April CPI data from the Federal Statistical Office showed. The consumer-price inflation rate slowed to 1.0% y/y from March’s 1.1% y/y. The harmonised index of consumer prices (HICP), calculated for European purposes, declined 0.1% m/m in April after a 0.6% m/m advance in March. The HICP rate slowed to 1.0% y/y from March’s 1.2% y/y.

·                German wholesale prices rose a more-than-expected 1.7% m/m and 6.0% y/y in April after increases of 1.3% m/m and 4.3% y/y in March, data from the Federal Statistical Office showed.

·                In March, UK industrial production increased a more-than-expected 2.0% m/m and 2.0% y/y and manufacturing production grew a more-than-anticipated 2.3% m/m and 3.3% y/y, according to data from the Office for National Statistics.

Asia-Pacific

·                China’s consumer prices rose 2.8% y/y in April after a 2.4% y/y increase in March, the statistics bureau said. Property prices climbed 12.8% y/y in April. New lending totaled 774 billion yuan, the People’s Bank of China said.

FX Strategy Update


 
EUR/USDUSD/JPYGBP/USDUSD/CHFUSD/CADAUD/USDEUR/JPY 
Primary TrendPositiveNegativeNegativePositiveNegativePositiveNegative
Secondary TrendNegativePositiveNegativePositiveNegativeNeutralNeutral
OutlookNegativePositiveNeutralPositive  Positive NegativeNegative
ActionSellNoneNoneBuyNoneNoneNone
Current               1.268092.701.49561.11041.02110.8965117.55 
Original Position1.4628N/AN/A1.0340N/AN/AN/A
ObjectiveN/AN/AN/AN/AN/AN/AN/A
Stop1.3625N/AN/A1.0465N/AN/AN/A
Support

1.2600

1.2500

90.00

88.00

1.4800

1.4500

1.0900

1.0500

1.0200

0.9950

0.8800

0.8500

114.00

110.00

Resistance

1.3000

1.3300

93.50

94.50

1.5050

1.5350

1.1300

1.1500

1.0600

1.0800

0.9400

0.9600

120.00

126.00

 Wednesday’s Economic Calendar

Time (EDT)RegionDataPeriodChangeForecastPrevious
1:00JapanLEIMar P  98.5
1:00JapanCoincident indexMar P  100.5
2:00GermanyGDP saQ1 Pq/q0.0%0.0%
2:00GermanyGDP wdaQ1 Py/y1.1%-2.4%
2:00GermanyGDP nsaQ1 Py/y1.2%-1.7%
3:15SwitzerlandProducer & import pricesAprm/m0.4%0.5%
3:15SwitzerlandProducer & import pricesApry/y0.6%0.0%
4:30UKJobless claims changeApr -20.2K-32.9K
4:30UKClaimant count rateApr 4.8%4.8%
4:30UKILO unemployment rate – 3 mths-3mthsMar 8.0%8.0%
4:30UKAverage weekly earnings including bonus – 3 mths-3mthsMary/y2.2%2.3%
4:30UKAverage weekly earnings excluding bonus – 3 mths-3mthsMary/y2.0%1.7%
5:00EMUGDP saQ1 Aq/q0.1%0.0%
5:00EMUGDP saQ1 Ay/y0.4%-2.2%
5:00EMUIndustrial production saMarm/m1.1%0.9%
5:00EMUIndustrial production wdaMary/y 4.1%
5:30UKBank of England quarterly inflation report    
8:30CanadaInternational merchandise tradeMar C$1.6BC$1.4B
8:30CanadaNew housing price indexMarm/m0.3%0.1%
8:30USTrade balanceMar -40.0B-39.7B
14:00USMonthly budget statementApr  -$65.4B
19:50JapanTrade balance – BOP basisMar  ¥778.0B
19:50JapanAdjusted current account totalMar  ¥1119.0B
19:50JapanCurrent account totalMar ¥2212.5B¥1470.6B
21:30AustraliaParticipation rateApr  65.1%
21:30AustraliaUnemployment rateApr 5.3%5.3%
21:30AustraliaEmployment changeApr 23.0K19.6K

 Notes: N/A=not applicable/not available, ar=annual rate, sa=seasonally adjusted, nsa=non-seasonally adjusted, wda=working days adjusted, 3 mths=3 months, m/m=month-on-month, q/q=quarter-on-quarter, y/y=year-on-year, ytd=year-to-date, m=million, b=billion, t=trillion, unch=unchanged, a=advance, p=preliminary, r=revised, f=final, GDP=gross domestic product, LEI=leading economic indicators index, CPI=consumer price index, PPI=producer price index, PMI=purchasing managers index 

Hans Nilsson and Winnie Tapasanun

New York, May 11, 2010, 16:15 EDT


More...

This section is available only to members of the Globicus - Gold membership subscription. Please subscribe if you are interested in recent updates to this section by clicking HERE or contact us directly at subscriptions@globicus.com

Last Updated on Tuesday, 11 May 2010 21:39

ADVERTISEMENT

Advertisement