Euro rises in calm trading, British pound softens


The markets generally remain in consolidation mode today, with moderate movements. The British Pound is trading slightly lower, followed by Australia and the Dollar. The New Zealand dollar strengthened slightly after the initial decline. The euro and Swiss franc are also stronger, helped by buying against the pound. Gold is struggling to come under the 1900 grip, but looks poised to extend the recent rise. Volatile bitcoin is back above the 38k grip as sideways trading continues.

Technically, some attention is returning to the EUR / USD as it recovers after pulling the 4:55 EMA support. The breakout of 1.2244 will resume the recent rally to retest the high of 1.2348. EUR / JPY could also follow higher, with eyes on resistance at 133.42. The break will resume a wider uptrend. The question is whether such moves, if any, would spill over into dollar and yen sales elsewhere.

In Europe, at the time of writing, the FTSE is up 0.08%. DAX is on vacation, CAC is down -0.02%. Earlier in Asia, Nikkei rose 0.17%. Hong Kong HSI fell -0.16%. China Shanghai SSE rose 0.31%. The Singapore Strait Times rose 0.18%. Japan’s 10-year JGB yield fell from -0.0014 to 0.082.

NABE: Survey panelists predict inflation will ease in second half

According to a investigation According to the National Association of Business Economists, US GDP is expected to grow 8.5% annualized in the second quarter, well above the March survey’s median forecast of 5.2%. The median estimate of real GDP growth for 2021 as a whole is 6.7%, compared to 4.8% for the month of March. Respondents expected inflation to accelerate sharply in 2021, before slowing down in 2022. The CPI is expected to stand at 2.8% year-on-year in the fourth quarter of 2021. Core inflation ECP is expected to settle at 2.2% in the fourth quarter of 2021.

“NABE panelists expect inflationary pressure in the short term, but expect it to be short-lived,” added Holly Wade, chair of the survey, executive director of the NFIB Research Center. “Inflation expectations have risen considerably compared to those in the March survey, but panelists expect inflation to slow in the second half of 2021, with no recovery in 2022.

BoJ Kuroda: We’re starting to see the light at the end of the pandemic tunnel

In one word“Said BoJ Governor Haruhiko Kuroda,” we are starting to see the light at the end of this pandemic tunnel, but the light does not clearly reveal the shape of the society and the economy that we are approaching.

“Given the considerable uncertainty we face, it is only natural that we have different views on the relative importance of the issues at stake and the direction our discussions should take.”

At the moment, we don’t have to agree on all the details; the important thing is that participants from central banks, international institutions and academia present their points of view and share their ideas.

New Zealand retail sales increased 2.5% qoq in Q1

Retail sales in New Zealand increased 2.5% q / q in Q1, much better than expected of -1.8% q / q. 10 of the 16 regions posted higher sales values. Non-auto sales increased 3.2% q / q, also well above expectations of -1.0% q / q.

Electrical and electronic products saw the largest increase, up 8.4%, followed by leisure items, up 16% in the March 2021 quarter.

“The rise in spending in the electrical industry coincides with falling prices for computers and phones in the first quarter of 2021,” said Sue Chapman, director of retail.

EUR / USD Mid-Day Outlook

Daily Pivots: (S1) 1.2148; (P) 1.2194; (R1) 1.2227; After….

EUR / USD remains in consolidation from 1.2244 and intraday bias remains neutral first. A further rise is expected with support at 1.2050 intact. On the upside, the breakout of 1.2244 will resume upward from 1.1703 to retest the high of 1.2348. However, the breakout of 1.2050 will delay the bullish scenario. The intraday bias will be flipped lower to extend the consolidation pattern of 1.2348 with another lower leg.

Overall, the rise from 1.0635 is seen as the third step in the trend from 1.0339 (2017 low). Another rally could be seen as a resistance group at 1.2555 next, (38.2% retracement from 1.6039 to 1.0339 to 1.2516). This will remain the preferred case as long as the support for 1.1602 is maintained. The reaction from 1.2555 should reveal the long-term underlying momentum of the pair.

Update of economic indicators

GMT Ccy Events Real Provide Previous amended
22:45 NZD Retail sales Q / Q Q1 2.50% -1.80% -2.70% -2.60%
22:45 NZD Retail sales excluding Autos Q / Q Q1 3.20% -1.00% -3.10% -2.90%
12:30 p.m. USD Chicago Fed National Activity Index, April 1.71

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