Talking Points:
US Dollar Selling May Continue on Status-Quo FOMC Announcement
Aussie Dollar Corrects Lower After Largest Rally in Nearly 15 Months
NZ Dollar Fails to Hold Gains on Trade Data as RBNZ Looms Ahead
The outcome of April’s Federal Reserve monetary policy meeting is likely to dominate the spotlight in the hours ahead. A rate hike seems overwhelmingly unlikely just yet, putting the onus on the statement accompanying the announcement.
Rhetoric matching the month-to-month guidance regime introduced last month will amount to the status quo. Such an outcome may weigh on the US Dollar as the absence of fresh fuel to power near-term tightening speculation opens the door for continued profit-taking on long-USD positions.
German CPI figures are expected to show the headline year-on-year inflation rate rose to 0.4 percent in April, the highest in five months. The result seems unlikely to meaningfully impact the Euro however considering its limited impact on ECB policy trends as the central bank proceeds with its €60 billion/month QE effort.
The Australian Dollar underperformed in overnight trade, falling as much as 0.6 percent on average against its top counterparts. The move appeared corrective following yesterday’s outsized advance that brought the currency higher by an impressive 1.8 percent, marking the largest advance in nearly 15 months.
The New Zealand Dollar briefly rallied following better-than-expected Trade Balance figures. Follow-through quickly fizzled however, with traders seemingly unwilling to commit to a directional bias ahead of the upcoming RBNZ policy announcement.
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Asia Session
GMT
CCY
EVENT
ACT
EXP
PREV
22:45
NZD
Trade Balance (NZ$) (MAR)
631M
300M
83M
22:45
NZD
Trade Balance YTD (NZ$) (MAR)
-2407
-2700M
-2135M
22:45
NZD
Exports (NZ$) (MAR)
4.93B
4.40B
3.89B
22:45
NZD
Imports (NZ$) (MAR)
4.30B
4.05B
3.81B
1:00
NZD
NBNZ Business Confidence (APR)
30.2
–
35.8
1:00
NZD
ANZ Activity Outlook (APR)
41.3
–
42.2
1:45
CNY
Westpac-MNI Consumer Sentiment (APR)
111.1
–
114.7
European Session
GMT
CCY
EVENT
EXP
PREV
IMPACT
6:00
CHF
UBS Consumption Indicator (MAR)
–
1.19
Low
6:00
GBP
Nationwide House Price index (MoM) (APR)
0.2%
0.1%
Medium
6:00
GBP
Nationwide House Price Index (YoY) (APR)
4.1%
3.8%
Medium
8:00
EUR
M3 Money Supply (YoY) (MAR)
4.3%
4.0%
Medium
8:00
EUR
M3 3-Month Average (MAR)
4.1%
3.8%
Medium
8:00
EUR
ECB’s Hanson Speaks on Eurozone Outlook
–
–
Low
9:00
EUR
Business Climate Indicator (APR)
0.2
0.23
Low
9:00
EUR
Industrial Confidence (APR)
-2.9
-2.9
Low
9:00
EUR
Consumer Confidence (APR F)
-4.6
-4.6
Low
9:00
EUR
Economic Confidence (APR)
103.9
103.9
Low
9:00
EUR
Services Confidence (APR)
6
6
Low
10:00
GBP
CBI Reported Sales (APR)
25
18
Low
12:00
EUR
German CPI (MoM) (APR P)
-0.1%
0.5%
High
12:00
EUR
German CPI (YoY)(APR P)
0.4%
0.3%
High
12:00
EUR
German CPI – EU Harmonized (MoM) (APR P)
-0.1%
0.5%
High
12:00
EUR
German CPI – EU Harmonized (YoY) (APR P)
0.2%
0.1%
High
Critical Levels
CCY
Supp 3
Supp 2
Supp 1
Pivot Point
Res 1
Res 2
Res 3
EURUSD
1.0682
1.0813
1.0897
1.0944
1.1028
1.1075
1.1206
GBPUSD
1.4952
1.5119
1.5229
1.5286
1.5396
1.5453
1.562
— Written by Ilya Spivak, Currency Strategist for DailyFX.com
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Source: Daily fx