European Outlook: 10-year Bund yields down -0.2 bp at 0.627% in opening trade, the 2-year is up 0.3 bp at -0.564%. So a slight flattening of the yield curve, which mirrors developments in in the U.S.. Still, while 10-year Bund, JGB and Treasury yields are marginally down, they remain at high levels with the 10-year Treasury still holding above 3.0%. Stock markets meanwhile are struggling to come to terms with the prospect of yields rising amid signs of a slowdown in growth. Asian markets traded mixed and while NASDAQ futures got a lift from earnings reports, Dow Jones and USA500 futures are down. In Europe stock futures are moving higher, led by the GER30, amid reports that China will cut import duties on cars. Still, trading is likely to remain cautious ahead of the ECB meeting today. With Draghi widely expected to keep rates on hold, the focus will be on the presser and signs that the central bank is inching closer to a decision on QE. The Riksbank is also expected to keep rates steady. The calendar also has U.K. mortgage data and the CBI retailing survey. German consumer confidence at the start of the session fell back slightly – as expected
FX Update: The dollar has dipped after posting fresh highs versus the euro and yen, among other currencies. EURUSD posted an eight-week low at 1.2159 while US-JPY rose of an eighth consecutive day, making an 11-week high at 109.46. The move reflected ongoing dollar strength, although the yen has been among the leaders of the underperforming currencies over the last week, too. Loose fiscal policy and Fed tightening expectations have been providing the fundamental underpinnings of the dollar’s ascent, with flagging global stock markets an indirect positive. On the trade front, China said today that it will be cutting the levy on imported cars to about 10-15% from 25% currently. On the geopolitical front, focus is on what Trump decides with regard to the Iran nuclear deal.
Charts of the Day
Main Macro Events Today
ECB – The ECB is widely expected to keep rates and guidance unchanged at today’s meeting. Draghi will likely sound pretty much like Praet on April 17. Cautiously optimistic on growth and the medium term inflation outlook – to keep a phasing out of QE this year in play, but not convinced yet that inflation developments have met criteria for sustained adjustment.
US Labor Data – Expectations – -Unemployment Claims expected slightly lower at 230K from 232K last week.
US Durable Goods – Expectations – rising to 1.5% in March , on top of the 3.0% jump in February, with shipments and inventories also expected to be up strongly at 0.7% and 0.4%, respectively.
UK Gfk Consumer Confidence – Expectations – at -7, which would be unchanged from the previous month.
Japanese CPI, Labor Data and Retail Sales – Tokyo April CPI likely slipped to an 0.8% y/y clip from 1.0% overall, and on a core basis, rose to 0.9% y/y from 0.8%. March unemployment rate is seen steady at 2.5%, while the job offers/seekers ratio should stay unchanged at 1.58. March retail sales are expected to post a 1.6% y/y clip, slightly down from the previous 1.7% increase.
Support & Resistance Levels
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.
Please note that times displayed based on local time zone and are from time of writing this report.
Click HERE to access the full HotForex Economic calendar.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!
Click HERE to READ more Market news.
Senior Market Analyst
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
InvestOpen, is for more than 8 years, one of the prime online destination for information and discussion about forex trading, offshore companies, online investments and crypto-currencies like bitcoin. Here you can share your experiences, advertise your business, seek help and make friends. About us