Forex Market Update
This morning, the greenback is trading lower against most of the major currencies.
A slate of confidence indicators just released from the Euro-zone indicated a modest recovery in the economic conditions in the region, while GDP data from Spain showed improvement in the first quarter of 2013, though remained in contraction territory.
Yesterday, the Organization for Economic Cooperation and Development in its half-yearly update, cautioned that lingering economic weakness in Europe ‘‘could evolve into stagnation with negative implications for the global economy.’’
The Canadian Dollar extended its previous session gains against the USD and is trading higher this morning, as the outgoing Bank of Canada Governor, Mark Carney left interest rates unchanged and stated that the interest rates may rise in near term. Against this backdrop, the Canadian gross domestic product (GDP) data scheduled to be released tomorrow would garner a lot of market attention.
The Australian Dollar recovered from previous losses against the US Dollar, after data showed that building approvals in Australia grew more-than-expected in April, dampening the prospect for an interest rate cut by the Reserve Bank.
The greenback traded lower in the New York session yesterday, against the key currencies.
EUR USD
This morning at 09:40 GMT, the EUR is trading at 1.2992 against the USD, 0.41% higher from the New York close, after economic sentiment index in the Euro-zone rose to a reading of 89.4 in May, from a reading of 88.6 recorded in the previous month. Additionally, business climate, industrial confidence and consumer confidence in the Euro-zone also improved in May. Separately, gross domestic product data from Spain indicated that the nation contracted 0.5% in Q12013. During the session, the pair traded at a high of 1.2992 and a low of 1.2932. Yesterday, EUR traded marginally lower against the USD in the New York session, and closed at 1.2939.
The pair is expected to find its first support at 1.2919 and first resistance at 1.3029.
GBP USD
At 09:40 GMT, the GBP is trading at 1.5194 against the USD, 0.44% higher from the New York close, after economic data indicated that house prices in the UK picked up in May. The Nationwide house prices in the UK rose by a seasonally adjusted 0.4% (MoM) in May, compared to a flat rate recorded in the previous month. During the session, the pair traded at a high of 1.5194 and a low of 1.5113. Yesterday, GBP traded marginally higher against the USD in the New York session, and closed at 1.5127.
The pair is expected to find its first support at 1.5069 and first resistance at 1.5238.
USD JPY
The USD is trading at 100.72 against the JPY at 09:40 GMT this morning, 0.44% lower from the New York close. The Yen registered gains after data indicated that, investors in Japan sold a net ¥1.12 trillion of foreign bonds in the week ended May 24, the most since the period ended April 5. Data on Japan’s consumer price inflation, unemployment rate and industrial production set to be release earlytomorrow would further determine the trading pattern in the pair. During the session, the pair traded at a high of 101.57 and a low of 100.46. In the New York session yesterday, the USD traded 0.08% lower against the JPY, and closed at 101.17.
The pair is expected to find its first support at 100.22 and first resistance at 101.63.
USD CHF
This morning at 09:40 GMT, the USD is trading at 0.9574 against the Swiss Franc, 0.51% lower from the New York close. The Swiss Franc received support after data indicated that gross domestic product in Switzerland rose by a seasonally adjusted 0.6% (QoQ) in the first quarter of 2013, following a revised 0.3% growth recorded in the previous quarter. During the session, the pair traded at a high of 0.9642 and a low of 0.9564. In the New York session yesterday, the USD traded 0.15% lower against the CHF, and closed at 0.9623.
The pair is expected to find its first support at 0.9522 and first resistance at 0.9679.
USD CAD
At 09:40 GMT, the USD is trading at 1.0329 against the CAD, 0.22% lower from the New York close. During the session, the pair traded at a high of 1.0369 and a low of 1.0328. Yesterday, the USD traded 0.22% lower against the CAD in the New York session, and closed at 1.0352. The Bank of Canada (BoC), in its monetary policy meeting held yesterday decided to keep its interest rate unchanged at 1.0%.
The pair is expected to find its first support at 1.0307 and first resistance at 1.0385.
AUD USD
The AUD is trading at 0.9663 against the USD, at 09:40 GMT this morning, 0.32% higher from the New York close, after data indicated that building permits in Australia climbed 27.3% (YoY) in April, following a 3.9% rise recorded in the previous month. The pair’s direction later in the day would be dominated by movements in the US Dollar, with the release of GDP and initial jobless claims data in the US. During the session, the pair traded at a high of 0.9699 and a low of 0.9582. AUD traded 0.07% higher against the USD in the New York session yesterday, and closed at 0.9632.
The pair is expected to find its first support at 0.9594 and first resistance at 0.9726.
Gold
At 09:40 GMT, Gold is trading at $1405.53 per ounce, 0.88% higher from the New York close, after the US Dollar fell sharply. This morning, Gold traded at a high of $1411.27 and a low of $1389.00 per ounce. In the New York session yesterday, the yellow metal traded 0.41% higher, and closed at $1393.25.
Gold has its first support at $1388.19 and first resistance at $1417.07.
Silver
Silver is trading at $22.76 per ounce, 1.04% higher from the New York close, at 09:40 GMT this morning, tracking gains in the yellow metal. This morning, Silver traded at a high of $22.83 and a low of $22.38 per ounce. Silver traded 0.73% higher against the USD in the New York session yesterday, and closed at $22.52.
Silver has its first support at $22.38 and first resistance at $22.98.
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Crude Oil
At 09:40 GMT, Oil is trading at $92.60 per barrel, 0.20% lower from the New York close, ahead of a meeting by the Organization of the Petroleum Exporting Countries and the crude oil inventory data from the US Energy Information Administration. Late yesterday, the American Petroleum Institute reported that the US crude inventories rose by 4.4 million barrels in the week ended 24th May, compared to expectations for a drop of 1.1 million barrels. This morning, Oil traded at a high of $93.29 and a low of $92.34. Yesterday, Oil traded 1.74% lower against the USD in the New York session, and closed at $92.75.
It has its first support at $91.55 and first resistance at $94.43.
Economic Snapshot
House prices in the UK rose in May
In the UK, the Nationwide house price index advanced 1.1% annually in May, against the forecast for a 0.9% rise and following a 0.9 % annual growth registered in the previous month. On a monthly basis, the house price index rose 0.4% in May, compared to a flat change recorded in the previous month.
Lloyds business barometer in the UK climbed in May
The Lloyds Business Group has reported that business barometer in the UK climbed to a reading of 39.0 in May, compared to a reading of 27.0 recorded in the previous month.
Euro-zone sentiment indices rose in May
In the Euro-zone, the economic sentiment indicator rose to a reading of 89.4 in May, compared to a reading of 88.6 in the previous month. Business climate indicator climbed to a reading of -0.76 in May, compared to a reading of -1.04 in the previous month. Additionally, services sentiment indicator rose to a reading of -9.3 in May, compared to a reading of -11.1 in the previous month. Moreover, industrial confidence indicator rose to a reading of -13.0 in May, compared to a reading of -13.8 in the previous month.
Euro-zone consumer confidence improved in May
In the Euro-zone, consumer confidence indicator rose to a reading of -21.9 in May, compared to a reading of -22.3 in April.
Swiss economy expanded in the Q12013
On a seasonally adjusted, gross domestic product (GDP) in Switzerland climbed 0.6% (QoQ) in Q12013, following a revised 0.3% rise registered in the Q42012. Annually, the GDP rose 1.1% in the Q12013, following a 1.4% gain recorded in the Q42012.
Italian PPI declined in April
In Italy, Producer Price Index (PPI) declined 0.4% (MoM) in April, compared to a flat change recorded in the previous month. On an annual basis, PPI fell 1.0% in April, compared to a 0.1% drop recorded in March.
Spain inflation increased more-than-expected in May
In Spain, consumer price index rose 1.7% in May, compared to a 1.4% rise recorded in April. Market had expected a rise of 1.6%. Additionally, harmonized inflation rose to 1.8% in May against the forecast for a 1.7% rise and following a rate of 1.5% in April.
Spanish GDP fell in line with preliminary estimate in the Q12013
In Spain, GDP fell 0.5% (QoQ) in the Q12013, in line with the preliminary estimate, and compared to a 0.8% drop recorded in the Q42012.
Building approvals in Australia rose in April
On a seasonally adjusted monthly basis, building approvals in Australia increased 9.1% in April, compared to a 5.5% drop registered in March. Also, building approvals jumped 27.3% (YoY) in April, following a 3.9% rise recorded in the previous month.
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