FX News Today

Very mixed data from Japan overnight:  Household spending exceeded expectations at 1.2% (-1.8% expected) however, the  Unemployment rate inched up to 3.3% from 3.2% and Retail Sales also missed significantly coming in at 0.5% against expectations of 1.6%. Prime Minister Abe assured markets that he will proceed with the scheduled tax hike next year (since the first one went so well) unless Japan is hit by a Lehman crisis-scale shock of 2008 or an earthquake on the scale of 2011’s. He’s also not thinking at all about dissolving the Lower House and calling snap elections. A majority of analysts still expect Abe to delay the proposed sales tax hike to 10% from 8% slated for April of next year. USDJPY trading higher at 113.40.

US Reported a weak Q1 consumption:  The February personal income report halved  Q1 “real’ consumption growth forecast to 1.8% from 3.6%, and trimmed Q1 GDP growth forecast to 1.0% from 1.4%. There was also a small widening in the February goods trade deficit to $62.9 bln, though there was big February export and import gains that mostly reversed outsized declines in January to leave a better Q1 outlook for global trade. The bad news for spending was partly offset by a big Dallas Fed bounce to -13.6 from -31.8 with an ISM-adjusted rise to 47.6 from 44.4, alongside a 3.5% February pending home sales rise that’s consistent with comfortable housing sector gains into the Spring home sales season.

Fed Policy Outlook: The already slim chance for an April rate hike was lowered further by the disappointing income report. The sluggish Q1 growth outlook, along with the failure for PCE to edge closer to the FOMC’s 2% target, should keep the Fed sidelined until at least June. Comments from several Fed officials last week, including several doves, all of whom reminded that April was in play, increased worries that the Fed could pull the trigger next month. But that seems highly unlikely now, and Fed funds futures are creeping higher again too. The implied May contract points to a 0.390% rate, only fractionally higher than the current 0.375% target mid-point.

 

 

Main Macro Events Today

• US Consumer Confidence

March consumer confidence is out later and should reveal a 94.0 (median 93.7) headline, up from 92.2 in February. Already released measures of confidence for the month spell out the potential for downside risk to the headline. The Michigan Sentiment report revealed a decline to 90.0 from 91.7 in the first release and the IBD/TIPP Poll fell to 46.8 from 47.8 in February.

• Fed Chair Yellen Speech

Due to deliver a speech titled “Economic Outlook and Monetary Policy” at the Economic Club of New York luncheon. All eyes on the speech as traditional Doves on the FOMC have become more hawkish in recent pronouncements.

 

Janne Muta

Chief Market Analyst

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

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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.

FX News Today

US Durable Goods – Big February declines:  Also downward January revisions across all the major orders, shipments, equipment and inventory figures that reflected weakness both with and without transportation and defense orders declines. We lowered our Q1 GDP growth forecast to 1.4% from 2.0% after a likely Q4 boost to 1.2% from 1.0%, given what we now assume will be a 3% Q1 contraction rate for equipment spending, versus our prior 4% projected growth clip. Inventories are poised to subtract $22 bln from GDP in Q1 to leave a $57 bln accumulation rate, after a $6.3 (was $3.8) bln subtraction in Q4. We expect a 0.5% February factory inventory drop with a 0.2% total business inventory decline, given today’s 0.3% factory durable inventory decrease. We assume a 2.2% February factory orders drop with a 1.2% factory shipments decline, given an assumed 1.5% price-led nondurable shipments and orders drop.

US Markit flash services PMI improved: There was a 1.3 points to 51.0 in March after diving 3.5 points to 49.7 in February. The bounce puts the index back into expansionary territory after the surprise February decline to the lowest reading since October 2013. However, the new business index slid to 50.8 from 52.1, and is the lowest reading on record. The March composite index also rose 1.1 points to 51.1 from February’s 50.0 (which was also the lowest since October 2013). New orders declined to 51.2 from 52.2, and is a record low. Though the headline gains are good news, some of the internals inject a question mark into the growth outlook.

US Initial Unemployment claims rise to 265k: This was for the third week of March followed big downward claims revisions in both January and February attributable to annual revisions that left a lean 259k (was 265k) BLS survey week figure and a 253k (was 259k) cycle-low at the start of the month. The revised data still show elevated holiday levels, but less of an auto-retooling hit in July. Claims are averaging just 260k in March, versus prior averages of 261k (was 269k) in February, 282k (was 284k) in January and 277k in December. The 259k BLS survey week reading sits close to the 260k (was 262k) February BLS figure and below prior BLS readings of 291k (was 294k) in January, and 275k (was 272k) in both November and December. We expect a 190k March nonfarm payroll rise that undershoots the 242k February pop but beats the 172k January increase, with upside risk from a tightness in claims, a firming in producer sentiment after weak winter readings, and an encouraging ADP path through a 214k February rise.

 

Main Macro Events Today

• US GDP 

The third release on Q4 GDP is out today and should reveal a revised headline of 1.2% (median 1.0%) from 1.0% in the second release, 0.7% in the first release and 2.0% in Q3 of last year. We expect $6 bln in net upward revisions in the release with consumption revised up by $5 bln, net exports up by $4 bln and construction revised up by $2 bln but with offsetting revisions of -$1 bln for equipment and -$2 bln for intellectual property.

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.

FX News Today

European Outlook: Asian stock markets sold off overnight, oil prices are below USD 40 per barrel, and the USD continues to rise after hawkish Fed comments. The EUR is also up against most currencies, highlighting one of Draghi’s problems, which haven’t gone away after the last round of easing measures. US and UK stock futures are also down and it seems markets will be going into the Easter holidays with in a risk off mode, amid fresh uncertainties about the US rate outlook and geopolitical risks. EU Interior Ministers will meet today to talk about terror threats. The ECB publishes its monthly bulletin and the data calendar includes, French business confidence and UK retail sales.

US New Home Sales beat expectations: There was a 2.0% rise to a 512k rate in February after net upward revisions that left a 12.0% five-month climb from a 10-month low of 457k in September, though sales remain 6.1% below last February’s 545k cycle-high. Both inventories and median prices also beat estimates after upward revisions, with a 1.7% inventory rise to a six-year high in January and a 6.2% median price rise that leaves a 2.6% y/y increase. New home sales are poised for a 511k average in Q1 after disappointing 2015 rates of 510k (was 509k) in Q4, 488k in Q3 and 497k in Q2, but a higher 517k cycle-high rate in Q1 of last year. New home sales have risen 90% from the 273k record-low in February of 2011, alongside smaller cyclical climbs of 39% for pending home sales and 47% for existing home sales from lows in 2010. We saw big cyclical climbs of 146% for housing starts and 127% for permits from lows in 2009, and 142% for new home construction from a low in 2011.

Fed’s Bullard makes a case for April: In a Bloomberg TV interview, he has growing concerns about its guidance. He thinks policy is in reasonably good shape, but the odds the Fed falls behind the curve have increased modestly. There will likely be an overshoot on NAIRU near term, with the unemployment rate falling below 4.5% this year and that may force the FOMC to have to hike rates more rapidly later on, he acknowledged. Core PCE inflation should be over 2% in 2017. It’s unlikely the Fed will go to a negative rate policy. He also noted all meetings are “live.” Neither of those should be revelations, however, as the mix of data have indeed kept the door open for action next month (indeed, that was the surprise with the March FOMC, that it seemed to disregard the increase in inflation).

US VIX equity volatility has turned higher:  with the downdraft on stocks after the perverse terror-rally on Tuesday succumbed to a round of hawkish Fedspeak, dollar gains and a commodity downturn yesterday. The VIX closed 5.43% higher just shy of the psychologically important 15 at a day high of 14.94. Having roamed as low as 14.17 after basing at 13.79 2016 lows on Monday. That’s still well off 32.09 2016 highs set back in January, but the VIX keeps getting capped by central bank policy largesse as the BoJ followed the ECB into NIRP and the Fed took a dovish tack in its statement last week. Looks like the VIX is getting complacent again relative to global risks, which could put in a floor in the 12-14 zone before a run back over 20 if the S&P 500 retests its 2,017 200-day MA on the downside again.

 

Main Macro Events Today

• UK Retail Sales:

Expected to fall -0.7% from a rise in February of 2.3% It’s the primary gauge of consumer spending, which accounts for the majority of overall economic activity. If the fall is less than expected then this could be positive for GBP.

• US Durable Goods:

Durable goods orders expected to fall 2.0%., Shipments expected at -0.5%.Inventories expected to grow 0.1%.I/S ratio expected at 1.65 from 1.64 in January. Forecast risk: downward, as there was a decrease in Boeing orders in February.

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.

FX News Today

European Outlook: Asian stock markets were mostly slightly lower, U.S. and U.K. stock futures are also heading south. European markets managed to close with a slight gain yesterday, after recovering from the initial bout of risk aversion following the Brussel’s terror attacks. Today’s calendar is pretty empty, with a German 30-year Bund sale and comments from Bundesbank President Weidmann.

Fed’s Evans looks for 2016 growth of around 2% to 2.5%: The economic fundamentals are quite good, sharing the views of his FOMC colleagues, while adding that international developments have been a drag. But, he seems a little more cautious in terms of future rate hikes. And unlike Williams or Lockhart who underscored that April is a live policy meeting in recent comments, he said a “wait and see” approach is more appropriate so that risks can be assessed. Remember though, that he has been one of the more ardent doves (though so was Williams). The economic and financial risks in 2016 are somewhat higher than he had hoped. He also suggested 2 rate hikes this year is a decent assumption. The non-voter also said the Fed needs rates to go up organically, as a result of a stronger economy.

U.S. Markit flash manufacturing PMI up to 51.4: It rose 0.1 in March, after declining 1.1 points to 51.3 in February. However, this is a 5th straight month the index has held a barely expansionary 51, 52 handle. The index topped out last year at 55.7 in March and generally eroded from there. Both employment and new orders increased. The improvement is consistent with the trend in Eurozone PMI data earlier yesterday which mostly beat expectations.

Iraq plans to accept the oil freeze proposal: According to the Iraqi oil ministry they will accept the proposed freeze at January output levels. This followed news that marginal producer Libya did not plan to attend the Doha OPEC meeting in April. WTI crude oil (USOil) lost 1% overnight but remain close to three month highs, it is currently trading at $41.00. US weekly crude inventories are released later today and are expected to increase to 2.5m bbls.

 

Main Macro Events Today

• US New Home Sales

February new home sales are out later today and should reveal a 1.2% increase to a 500k (median 520k) pace from 494k in January and 544k in December. Other data for the month were mixed with the MBA purchase index down 4.9% after rising 1.4% in January and existing home sales dropping 7.1% to 5.080 mln from 5.470 mln in January. New Homes Sales are a leading indicator of economic activity due to its impact on other sectors such as mortgages, furniture and appliance sales and general confidence.

• Weidmann Speech

Jens Weidmann the President of the Deutsche Bundesbank is due to speak at the Liechtenstein Finance Forum. He is a full voting and very influential member of the ECB Governing Council. He is likely to remain critical of any further ECB activism.

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.

FX News Today

European Outlook: Asian stock markets were mixed, with Japan outperforming and posting robust gains as the Yen weakened following hawkish comments from Fed officials yesterday. U.S. stock futures are down, but U.K. stock futures are moving higher and with the EUR falling against the USD and the front end Nymex future holding above USD 41 per barrel, the DAX may take another attempt at clearing the 10000 mark. The calendar is full today, with Eurozone confidence data in the form of ZEW, Ifo and PMIs and U.K. inflation and public finance data.

Japan flash manufacturing PMI falls: Japan flash manufacturing PMI sank to 49.1 in March compared to 50.1 for the final February reading, registering the first contraction since April of 2015. New export orders shrank at the quickest pace in over 3-year as well, falling from 49.0 in February to 45.9. This stands in contrast to words of optimism Finance Minister Aso, who earlier said that underlying economic fundamentals were firm and there’s no need now for compiling economic stimulus steps. The Yen fell on the news with the USDJPY recovering the 112.00 level it last traded above on Thursday.

Fed’s Lockhart and Williams cautioned that a rate hike in April is possible: This echoes sentiment from Fed Chair Yellen last week, (remember too that Yellen indicated late last year that ALL meetings are live). So this sentiment should not be surprising. However, what is different in these remarks is that Williams has been one of the more dovish on the FOMC until sliding toward the hawkish side late last year, while Lockhart have been a dovish leaning centrist. Such comments, especially in the wake of last week’s policy meeting, where not only was there no further boosts in rates, but the Committee revised down its outlook for the Fed funds rate path for 2016. Such comments will only serve to keep the markets confused and anxious, and won’t help the FOMC’s credibility. June still seems like the better date for the next rate hike.

 OPEC says it’s up to Iran:  The cartel said Monday that it is up to Iran whether it participates in the oil freeze, given some conditions it has placed on its output, though it may join in the future, said Secretary General El-Badri. He earlier said that all OPEC countries will be invited to the April 17 producer meeting, expressing optimism that the upward price trend will continue, though at this time the only problem is that the market has an overhang of 300 mln barrels. Well, that’s the producer side solved then. NYMEX crude (USOil) traded higher overnight at $41.50 bbl or about 1.5% higher on the session.

 

Main Macro Events Today

• Euro Data: Today brings an almost full round of Eurozone confidence indicators and overall we should see some stabilisation, with especially the ZEW expected to benefit from the prospect of further ECB stimulus. We are looking for a rise in the March ZEW to 4.5 (median 5.0) from 1.0. The Ifo Business Climate reading, meanwhile, is still expected to ease slightly to 105.6 (median 105.7) from 105.7, as future expectations remain depressed by weak orders inflow and falling exports. EMU PMIs on the other hand, could well be mixed again, and we expect the EMU Manufacturing PMI to recover somewhat and rise to 51.4 (median 51.3) from 51.2, while the services reading is seen unchanged at 53.3 (median same), which should leave the composite at 53.0 (median same) also unchanged from the previous month.

• UK CPI and PPI: UK CPI for March y/y is announced today with a expectations of and increase to 0.4% from 0.3% in February. This is the most important inflation data from the UK as it is used by the Bank of England as their inflation target. Later PPI input and output data will be release showing changes in the prices at the factory gate. Input prices are likely to rise 0.4% with output prices flat.

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.