Talking Points:
British Pound May Decline if Soft PMI Data Undermines BOE Policy Outlook
Australian Dollar Rallies After RBA Keeps Interest Rates Unchanged at 2.25%
See Economic Data Flow Directly on Your Charts with the DailyFX News App
UK Services PMI data headlines the economic calendar in European trading hours. Expectations suggest the pace of activity growth in the non-manufacturing sector will modestly accelerate in March. UK economic news-flow has tended to disappoint relative to consensus forecast recently, warning that analysts may be overestimating the economy’s vigor and opening the door for a downside surprise. Such an outcome may push out bets on a Bank of England interest rate hike further into the future, weighing on the British Pound. As it stands, futures markets are pricing in expectations for the central bank to begin dialing back stimulus in the first quarter of 2016.
The Australian Dollar outperformed in overnight trade after the Reserve Bank of Australia kept interest rates unchanged at 2.25 percent. As we discussed in our weekly forecast, analysts narrowly expected the outcome but traders were pricing in a 75 percent probability of a 25bps reduction. RBA Governor Glenn Stevens said further easing may be appropriate and policymakers will continue to assess the case for such action at forthcoming meetings.
New to FX? START HERE!
Asia Session
GMT
CCY
EVENT
ACT
EXP
PREV
23:30
AUD
AiG Perf of Services Index (MAR)
50.2
–
51.7
23:50
JPY
Official Reserve Assets ($) (MAR)
1245.3B
–
1251.1B
1:30
AUD
Retail Sales (MoM) (FEB)
0.7%
0.4%
0.5%
1:30
AUD
ANZ Job Advertisements (MoM) (MAR)
-1.4%
–
0.7%
4:30
AUD
RBA Cash Rate Target
2.25%
2.25%
2.25%
European Session
GMT
CCY
EVENT
EXP
PREV
IMPACT
7:00
CHF
Foreign Currency Reserves (MAR)
508.9B
509.3B
Low
7:45
EUR
Markit/ADACI Italy Services PMI (MAR)
51.0
50.0
Low
7:45
EUR
Markit/ADACI Italy Composite PMI (MAR)
–
51.0
Low
7:50
EUR
Markit France Services PMI (MAR F)
52.8
52.8
Low
7:50
EUR
Markit France Composite PMI (MAR F)
52.0
51.7
Low
7:55
EUR
Markit Germany Services PMI (MAR F)
55.3
55.3
Medium
7:55
EUR
Markit/BME Germany Composite PMI (MAR F)
55.3
55.3
Medium
8:00
EUR
Markit Eurozone Services PMI (MAR F)
54.3
54.3
Medium
8:00
EUR
Markit Eurozone Composite PMI (MAR F)
54.1
54.1
Medium
8:30
GBP
Official Reserves Changes ($) (MAR)
-1049M
Low
8:30
EUR
Eurozone Sentix Investor Confidence (APR)
20.8
18.6
Low
8:30
GBP
Markit/CIPS UK Services PMI (MAR)
57.0
56.7
High
8:30
GBP
Markit/CIPS UK Composite PMI (MAR)
–
56.7
High
9:00
EUR
Eurozone PPI (MoM) (FEB)
0.1%
-0.9%
Medium
9:00
EUR
Eurozone PPI (YoY) (FEB)
-2.9%
-3.4%
Medium
Critical Levels
CCY
Supp 3
Supp 2
Supp 1
Pivot Point
Res 1
Res 2
Res 3
EURUSD
1.0704
1.0830
1.0876
1.0956
1.1002
1.1082
1.1208
GBPUSD
1.4691
1.4801
1.484
1.4911
1.4950
1.5021
1.5131
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
To receive Ilya’s analysis directly via email, please SIGN UP HERE
Contact and follow Ilya on Twitter: @IlyaSpivak
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.Learn forex trading with a free practice account and trading charts from FXCM.
Source: Daily fx