Forex Trading Library

Forex Afternoon Wrap 29th April

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Key Notes:

  • UK Nationwide HPI m/m 1% vs. 0.2%; y/y 5.2% vs. 4.1%
  • Spain retail sales y/y 3.7% vs. 3.6%
  • UK CBI reported sales 12 vs. 25
  • German CPI m/m -0.1% vs. -0.1%; y/y 0.4% vs. 0.4%
  • Canada IPPI m/m 0.3% vs. -0.1%
  • US advance Q1 GDP 0.2%% vs. 1%
  • PCE annualized q/q 1.9% vs. 1.7%; core PCE annualized q/q 0.9% vs. 1%

Later:

  • US pending home sales
  • FOMC statement
  • RBNZ Monetary policy statement

Focus on US Dollar ahead of FOMC statement

Currency markets opened today with the US Dollar continuing to trade weaker after yesterday’s sharp selloff. The US Dollar was without a doubt the weakest currency with most of its peers gaining, especially the British Pound and the Australian Dollar, both of which have been testing near highs of 1.54 and 0.8 respectively.

The Kiwi dollar was trading in a tight range as the NZDUSD is in particular risk with the FOMC statement followed up by the RBNZ monetary policy, which is expected to make the currency very volatile with risks evenly laid out.

There was not much of major market news from the Asian trading session as the currencies chugged along higher. The Japanese Yen was weaker across the board but was holding ground against the Greenback. After today’s FOMC risk, the Yen will be looking to the Bank of Japan which meets tomorrow for its monetary policy.

The European trading session saw the release of Spanish retail sales which managed to beat estimates, rising 3.7%, but Germany CPI did not throw any surprises as inflation data matched estimates. Regardless, the Euro was trading stronger across the board, especially against the cross currencies such as the Aussie and the British Pound.

The US trading session saw the advance GDP miss estimates of 1%, rising 0.2%. However the markets saw a very subdued reaction to the data release as the markets were expecting a very modest rise around 0.2%. The PCE data was also mixed with the headline number rising to 1.9%, up from 1.7% estimates. Other economic data later includes the pending home sales data ahead of the main event coming from the US Federal Reserve later today.

Data from Canada saw the IPPI or industrial production price index rise 0.3%, beating estimates which strengthened the Canadian dollar briefly, especially against the Greenback.

Gold futures were seen trading above the 1200 handle but is seen struggling near the resistance at 1210. Failure to break above 1210 could see Gold post declines below the 1202 handle.

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