Talking Points:
Eurozone PMIs May Prove More Market-Moving for the Pound vs. the Euro
NZ Dollar Slumps as RBNZ’s McDermott Talks Down Rate Hike Possibilities
Franc Corrects Higher After Yesterday’s Aggressive SNB-Inspired Decline
The preliminary set of April’s Eurozone PMI figures headlines the economic calendar in European trading hours. The region-wide composite index is expected to show the pace of manufacturing- and service-sector activity growth continued to accelerate, hitting a new four-year high.
The report may not generate a lasting response from the Euro with ECB policy seemingly on auto-pilot for now. A supportive outcome may boost the British Pound however amid hopes that firming growth on the Continent will have positive spillover via a pickup in demand for UK exports. That in turn may drive speculation of a relatively sooner BOE interest rate hike. We remain short EURGBP.
The New Zealand Dollar underperformed in overnight trade, falling as much as 1 percent on average against its top counterparts. The move followed comments from RBNZ Assistant Governor John McDermott, who said the central isn’t considering an interest rate hike at present and would instead consider easing if demand and/or prices weakened.
The Swiss Franc proved strongest on the session as prices retraced some of yesterday’s outsized losses. That drop was sustained after the SNB reduced the number of institutions exempt from negative sight deposit rates, in effect expanding the scope of its easing effort.
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Asia Session
GMT
CCY
EVENT
ACT
EXP
PREV
22:45
NZD
Net Migration SA (MAR)
5000
–
4810
0:00
NZD
RBNZ Asst Gov McDermott Speaks in Hamilton
–
–
–
1:00
NZD
ANZ Consumer Confidence Index (APR)
128.8
–
124.6
1:00
NZD
ANZ Consumer Confidence (MoM) (APR)
3.4%
–
0.5%
1:30
AUD
NAB Business Confidence (1Q)
0
–
2
1:35
JPY
Markit/JMMA Mfg PMI (APR P)
49.7
50.7
50.3
1:45
CNY
HSBC Mfg PMI (APR P)
49.2
49.6
49.6
3:00
NZD
Credit Card Spending (MoM) (MAR)
0.6%
–
-0.1%
3:00
NZD
Credit Card Spending (YoY) (MAR)
5.2%
–
5.8%
European Session
GMT
CCY
EVENT
EXP
PREV
IMPACT
6:00
CHF
Trade Balance (MAR)
2.12B
2.47B
Medium
6:00
CHF
Exports Real (MoM) (MAR)
–
-2.8%
Medium
6:00
CHF
Imports Real (MoM) (MAR)
–
3.1%
Medium
6:00
EUR
Germany GfK Consumer Confidence (MAY)
–
10
Low
7:00
EUR
Markit France Mfg PMI (APR P)
49.2
48.8
Medium
7:00
EUR
Markit France Services PMI (APR P)
52.4
52.4
Medium
7:00
EUR
Markit France Composite PMI (APR P)
51.8
51.5
Medium
7:30
EUR
Markit/BME Germany Mfg PMI (APR P)
53.0
52.8
High
7:30
EUR
Markit Germany Services PMI (APR P)
55.5
55.4
High
7:30
EUR
Markit/BME Germany Composite PMI (APR P)
55.6
55.4
High
8:00
EUR
Markit Eurozone Mfg PMI (APR P)
52.6
52.2
High
8:00
EUR
Markit Eurozone Services PMI (APR P)
54.5
54.2
High
8:00
EUR
Markit Eurozone Composite PMI (APR P)
54.4
54.0
High
8:30
GBP
Public Finances (PSNCR) (MAR)
–
0.0B
Low
8:30
GBP
Central Government NCR (MAR)
–
3.5B
Low
8:30
GBP
Public Sector Net Borrowing (MAR)
6.5B
6.2B
Low
8:30
GBP
PSNB ex Banking Groups (MAR)
7.0B
6.9B
Low
8:30
GBP
Retail Sales Ex Auto (MoM) (MAR)
0.5%
0.7%
Medium
8:30
GBP
Retail Sales Ex Auto (YoY) (MAR)
5.5%
5.1%
Medium
8:30
GBP
Retail Sales Incl. Auto (MoM) (MAR)
0.4%
0.7%
Medium
8:30
GBP
Retail Sales Incl. Auto (YoY) (MAR)
5.4%
5.7%
Medium
9:00
EUR
Eurozone 4Q Government Debt
–
–
Low
9:00
EUR
Eurozone 4Q Government Deficit
–
–
Low
Critical Levels
CCY
Supp 3
Supp 2
Supp 1
Pivot Point
Res 1
Res 2
Res 3
EURUSD
1.0561
1.0653
1.0689
1.0745
1.0781
1.0837
1.0929
GBPUSD
1.4676
1.4843
1.4940
1.5010
1.5107
1.5177
1.5344
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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