FOREX News Today

European Outlook: Data today includes the EMU current account, UK CBI industrial trends and German PPI which is expected to rise to 0.2% from 0.0%. Overnight Asian stock markets managed to stabilise in tandem with oil prices. Crude prices rose to a seven month high and the front end WTI future has broken USD 49 per barrel. Japanese stocks are heading for a second weekly gain after recovering earlier losses with a weaker Yen helping to put a floor under markets as investors weigh the impact of a June rate hike in the U.S. on the global economy. The Nikkei is currently up 0.54%, the Hang Seng 1.20%, the CSI 300 up 0.105 and the ASX up 0.44%. U.S. stock futures are also moving higher.

Japanese Sales-Tax should be delayed: So says Etsuro Honda adviser to PM Abe the comments reported by Bloomberg says the sales tax hike planned from April 2017 should be postponed until the economy is completely free from deflation also that any economic package cannot offset the impact of the sales tax hike. This is in stark contrast to a senior member of the ruling party  (mr Yamamoto who says the economy will not recover if sales tax delay is just for show. The continued uncertainty and public disagreements by people close to PM Abe leaves a rather negative impact.  USDJPY remains north of 110.00.   

Mixed US data : The US data yesterday revealed a disappointing Philly Fed downtick to -1.8 from -1.6 that accompanied Monday’s Empire State plunge to -9.02 from 9.56, alongside a restrained 16k initial claims reversal of last week’s 20k pop that left a still-elevated 278k figure. Yet, we still have an improvement in producer sentiment since the bleak readings over the six months ending in February, and a claims rise in May after lean April data that mostly reflects seasonal adjustment difficulties from the early-Easter, the New York spring break, and the Verizon strike. We also saw a welcome 0.6% April leading indicators rise, as the index rebounds with an assumed bounce in GDP growth to 2.0% in Q2 from an upwardly-revised 1.0% (was 0.5%) in Q1.

Fedspeak – Fischer (Vice Chair) nothing revealing in his speech on policy or the economy. Dudley (3^rd most significant opinion) a hike in June or July is reasonable if the data conform to his outlook, said the Fed dove, who also noted June is “definitely” a live meeting. Of course the markets got that from the FOMC minutes yesterday, and he’s pleased with that outcome. The Q1 slowing in growth was a bit of a surprise and Q2 is shaping up to see stronger growth. The strength in retail sales helped bolster his view on the Q2 rebound. He thinks the economy is growing above trend with a tighter labor market. Brexit is another variable in the policy mix, he added. He didn’t give a time frame for the next rate hike, but rather reiterated that policy is still data dependent. He did acknowledge that it is important for the markets to grasp the FOMC’s thinking. Chair Yellen has a speech scheduled for June 6^th.

Main Macro Events Today

• US Existing Home Sales: April existing home sales data is out on todayy and should reveal a 1.3% headline increase to a 5.400 mln (median 5.390 mln) pace from 5.330 mln in March and 5.070 mln in February. Housing starts for April have already been released and posted an improvement to 1.172 mln from 1.099 mln in March and the NAHB housing sentiment index managed to hold steady at 58 from March.

• Canada CPI:  We expect CPI, due today, to accelerate to a 1.9% y/y pace in April (median +1.7%) from the 1.3% y/y pace in March. CPI is seen rising 0.5% on a month comparable basis in April (median +0.4%) after the 0.6% bounce in March. Gas prices shot 9% m/m higher in April after expanding 5.7% in March. Hence, gas prices should again provide a hefty lift to month comparable CPI. Of course, the currency appreciated further, with USD-CAD 5.0% to an average 1.256 in April. With the loonie also making headway in February and March, the exchange rate is expected to restrain price growth. The BoC’s core CPI index is seen rising 0.2% m/m in April after the stunning 0.7% gain in March. Annual core CPI growth is expected to expand at a 2.1% y/y rate in April (median +2.1%), matching the 2.1% pace in March. The BoC was sanguine about the pick-up in total and core CPI through the end of 2015, as they continued to lean on indicators suggestive of ongoing slack to make the case that the spike in core CPI was transitory. Another month of elevated core CPI will not shake the BoC’s view on the price backdrop. Notably, inflation remains on the backburner as growth is the focus.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: Global stock markets are pressured after the Fed minutes seemed to back June rate hike backs, with Asian stock markets mostly lower, and U.S. and U.K. stock futures also in the red. Yields are rising as the end to ever expanding monetary policy accommodation is coming into sight and the front end WTI future has fallen back below USD 48 per barrel Bund futures already extended losses in after hour trade yesterday and are likely to remain under pressure. UK markets underperformed yesterday as reduced Brexit bets boosted Sterling, and while GBP has eased somewhat it remains above 1.46 against the USD. The European calendar today as Eurozone current account and U.K. retail sales and the CBI industrial trends survey.

FOMC minutes showed a June hike was “likely”:  If data improved as expected. Officials wanted to keep options open for June. But there was a range of views on whether the economic numbers would be adequate to support a tightening next month. Consistent with the April 27 policy statement, many officials noted global risks needed to be closely monitored, with some noting specific worries over China’s currency and Brexit. However, “many” officials continued to see downside risks to the outlook, even as “some” saw global risks as having diminished. Meanwhile, a “few” officials (the more hawkish members) were talking about an April hike. The minutes certainly do set the stage for a tightening next month, though of course data will have to cooperate. Our call for a June hike is supported by the minutes to the April 26, 27 policy meeting.

Australia Adds Jobs: More new jobs were added to the Australian economy last month with the unemployment level remaining at 30 month lows. The unemployment rate remained unchanged at 5.7% (expectations increase to 5.8%); Employment rose 10,800 for March; Full-time jobs fell by 9,300; part-time employment rose by 20,200; Participation rate, a measure of labor force as a share of the population, dropped to 64.8%. It shows that low interest rates are helping sectors such as construction and tourism, however the fall in participation rates and the rise of part-time workers shows suggests only tepid growth.

BoJ seen expanding stimulus by July: According to the consensus view from the latest Reuters survey. 19 of the 22 respondents expect a move by July, with 7 anticipating a move in June and 12 predicting that the stimulus boost will come at the policy meeting in July, which would coincide with BoJ economic forecast updates. The three remaining respondents opted for the two-day meeting ending on Nov-1. 80% of respondents expect a combination of cutting negative rates further and upping the QQE program (two of PM Abe’s three arrows economic-revival plan), although the prevailing -0.1% rate isn’t expected to be touched until Q4. Note that the survey was conducted over the six days to yesterday, thereby missing today’s initial release of Q1 GDP data out of Japan, which smashed expectations at +1.7% q/q, well up on the median forecast for a 0.3% rise. On this, however, caveats apply. As the FT points out, first-estimate GDP data are apt for potentially big revisions in Japan. The report also highlighted that falling investment chopped 0.9 of a percentage point of GDP in Q1, which is seem largely as a consequence of the impact of yen strength on major Japanese businesses. This should maintain Japanese policymakers’ desire to weaken the yen, though don’t expect much jawboning on this until the upcoming G7 meetings have come and gone.

Main Macro Events Today

• US Philly Fed Manufacturing Index: May Philly Fed is out on Thursday and should reveal a headline to increase to 5.0 (median 3.0) from -1.6 in April and 12.4 in March. The already released Empire State Index for May posted a dramatic drop to -9.0 from 9.6 which could spell downside risk to the Philly Fed release. However, we expect some improvement in broad producer sentiment in May with the ISM-adjusted average of all measures ticking up to 52 from 51 last month and 53 in March.

• US Initial Jobless: Claims data for the week of May 14th are out today and should reveal a 297k (median 275k) headline following a 294k headline last week and 274k in the week prior. There is a chance that the big jump in claims last week was the result of spring break in NY public schools so there could be an unwind this week. We expect claims to average 275k in May from 259k in April and 264k in March. This would accompany an anticipated 190k nonfarm payroll headline for the month.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

FOREX News Today

European Outlook: Asian stock markets headed south, as stronger than expected GDP data out of Japan cast doubt over hopes of further easing and a delay to the sales tax hike, which added to US rate hike bets. FTSE 100 futures are also down. Positive leads then for European bond markets, which already moved higher yesterday, although the 10-year Bund future lost some of its gains in after hour trade. Today’s data calendar brings the final reading of Eurozone April CPI, expected to be confirmed at -0.2% y/y, and UK  labour market data. The April claimant count rate is seen steady at 2.1% and the ILO unemployment rate for March unchanged at 5.1% y/y. Earnings growth could show a slight deceleration in the rate excluding bonuses.

Japan’s GDP grew 1.7% in Q1: This following the downward revised 1.7% drop in Q4 (was -1.1%). The magnitude of the increase in Q1 easily outpaced projections (we saw +0.5%), but did follow a hefty downward revision to Q4. While the return to growth dodged a technical recession, the detail suggest underlying momentum is lacking in the economy, despite years of Abenomics and aggressive easing from the BoJ. Notably, an extra day in February due to leap year boosted consumption relative to the previous quarter. Private consumption grew 0.5% (q/q, sa) in Q1 after contracting a revised 0.8% in Q4 (was -0.9%). Business spending took a disappointing turn, falling 1.4% (q/q, sa) in Q1 after a revised 1.2% gain in Q4 (was +1.5%). The yen is steady, with USDJPY at 109.20.

Fedspeak: Fed’s Williams and Lockhart both noted June is a live meeting, in their comments at a Politico event. Both are doves, but have been noting the potential for further normalization this year, consistent with the FOMC’s projections of 2 25 bp hikes. Lockhart said it’s too early to draw conclusions about Q2 growth, but he wouldn’t take June off the table. Like several of his colleagues, he warns that the markets are more pessimistic than he is. Neither are voters this year. Fed moderate Kaplan said that the Fed should hike rates “in the not too distant future,” while he sees the household sector in good shape and forecasts a 2% rise in 2016 GDP, though still some slack in the labor force.

Main Macro Events Today

• EMU CPI: We expect the headline rate to be confirmed at -0.2% (median same). The decline back into negative territory last month was partly due to special factors with the earlier timing of Easter meaning that holiday related prices, which picked up over Easter, fell back again in April. This distorts the annual rate somewhat and goes some way to explain the swings over the March/April period. In any case, the ECB has already reacted pre-emptively with the March set of easing measures and is now firmly in wait and see mode and focused on implementing what has already been announced, so that any revision won’t change the immediate rate outlook.

• FOMC Minutes: Published at 21:00 GMT and should make interesting reading as a number of officials want interest rate hikes as early as June or July, whereas the market is discounting this heavily with only 23% of investors expecting a hike in either month. As ever the words that are used and indeed not used will be scrutinized closely.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.