Market Roundup
- US Chicago PMI May 46.2, (consensus 53, previous 52.3)
- US GDP Prelim Q1 -0.7%, (consensus -0.8%, previous 0.2%)
- Brazil GDP QQ Q1 -0.2%, (consensus -0.5%, previous 0.3%)
- Canada Mar budget balance, c$ decrease to -2.99 bln vs previous 4.63 bln
- Mexico Apr fiscal balance (pesos) decrease to -21.17 bln mxn vs previous 50.33 bln mxn
- United States May U Mich sentiment final increase to 90.7 (consensus 89.9, previous 88.6)
- United States May U Mich expectations final increase to 84.2 (consensus 83.1, previous 81.5)
- EUR/CHF rises off lows by 1.0280 to flash high at 1.0365, SNB tipped in market
- Reuters Poll in 2016 Brent crude to avg 70.90/bbl, US crude 65.90/bbl
- Sep Blatter re-elected FIFA president
Economic Data Ahead
- (2100 ET/ 0100 GMT) China NBS Non-Mfg PMI May (previous 53.4)
- (2100 ET/ 0100 GMT) China NBS Manufacturing PMI May (consensus 50.2, previous 50.1)
- (2145 ET/ 0145 GMT) China HSBC Mfg PMI Final May (previous 49.1)
- (1930 ET/ 2330 GMT) Australia AIG Manufacturing Index May (previous 48)
- (2030 ET/ 0030 GMT) Australia TD-MI Inflation Gauge May (previous 0.3%)
- (2130 ET/ 0130 GMT) Australia Building Approvals Apr (consensus -2%, previous 2.8%)
- (2130 ET/ 0130 GMT) Australia Private House Approvals Apr (previous 1.1%)
- (2130 ET/ 0130 GMT) Australia Business Inventories Q1 (consensus 0.1%, previous -0.8%)
- (2130 ET/ 0130 GMT) Australia Gross Company Profits Q1 (consensus 0.5%, previous -0.2%)
- (2130 ET/ 0130 GMT) Australia Company Profits Pre-Tax Q1 (previous -9.6%)
- (1950 ET/ 2350 GMT) Japan Business Capex (MOF) YY Q1 (previous 2.8%)
- (21335 ET/ 0135 GMT) Japan Manufacturing PMI May (previous 50.9)
Key Events Ahead
FX Recap
EUR/USD is currently trading in levels just shy of the psychological handle at 1.1000 (Monday opened at 1.1012). Today's poor US data have collaborated with the USD-weakness, lifting the pair to the 1.1000 neighbourhood. The upcoming week will be a very good test for the pair, as significant releases are due in both the US economy and Euroland, all preceding the key May's Non-farm Payrolls in the US economy. Next hurdle on the upside is at 1.007 (high May 29) followed by 1.1062 (low May 20) and then 1.1067 (38.2% of 1.1468-1.0819). Supports lie at 1.0867 (low May 28), 1.0819 (low May 27) and finally 1.0785 (low Apr 24).
GBP/USD is closing its sixth negative day in a row; second weekly decline consecutive. The pair has collapsed over 500 pips in two weeks. Recovery from the 1.5250 area has been capped today at 1.5300 just ahead the weekly close with the pair trading back to 1.5280. Currently the pair is trading at 1.5290, down 0.16% on the day, having posted a daily high at 1.5345 and low at 1.5236. Resistances are at 1.5300, 1.5320 and 1.5340 while supports are at 1.5250 and 1.5230.
USD/JPY rose and printed a fresh daily high at 124.20 but it was unable to rally further and fell. Currently the major is paring loses with a rally from the 123.80's in the US closing session today to remain in a positive space. The pair is currently trading at 124.06 with a high of 124.19 and a low of 123.59. In next week's docket we have US Payrolls and PMIs which will both count towards whether we will see a hike in, say, September this year or not. From the levels it had a week ago, USD/JPY is up more than 200 pips, on track for the highest weekly close since October 2002.
AUD/NZD saw a sharp rally on Friday, erasing weekly losses, hitting 1.0785 during the American session, the strongest level since last Thursday. The pair rallied on a weak kiwi which started to decline sharply in the market on Thursday and extended losses on Friday amid speculation about the possibility of a rate cut by RBNZ. The pair is about to end the week around 1.0760/70 levels, 65 pips above the level it had a week ago and almost 200 pips away from yesterday's lows.
