27 Apr: ECB on hold but cautious Draghi send the Euro lower. BOJ today. US preliminary Q1 GDP/PCE later

By | April 27, 2018

 

As expected, the ECB left rates unchanged on Thursday, and after a brief bounce from the Euro it then turned lower to finish the session near the lows, last seen in mid January.  Mario Draghi said in the press conference that economic expansion was solid and broad-based, despite the weaker than expected data, although overall he was cautious in indicating that more time is needed to assess whether the slowdown in Q1 was “temporary or permanent”. He also cautioned that understanding the factors behind the moderation in growth is “essential for informing our next decisions.” The Euro took the Chf and Sterling with it, while the Aud and Kiwi are also lower as traders unwind short US$ position, with the dollar generally being underpinned by better data for US trade, jobless claims and durable goods, which raised hopes for a Q2 bounce. The DXY is now almost back to unchanged on the year, currently at 91.57. In other markets, better corporate results have underpinned US markets, with the DJI/S+P up around 1% , with stocks also underpinned by slightly lower US bond yields. (US10Y, 2.983%). The metals are heavy, under pressure from the firm dollar, while WTI has been choppy but is pretty much unchanged o the day.

For Friday, Asia will look to the BoJ Meeting for guidance, where expectations are for the bank to maintain its current policy stance, even with two new Deputy Governors participating in the meeting for the first time. Australia will release the Q1 PPI (exp 0.4%mm, 1.2%yy). Later on the European focus will be on the German Unemployment and the UK Q1 GDP as well as the EU Economic Sentiment Indicator, Industrial Confidence, Services Sentiment, Business Climate for April. Finally the US will have the Preliminary Q1 GDP (exp 2.3% annualised) and the Core US Personal Consumption/Expenditure (exp 1.5%). The Rts/Michigan Consumer Sentiment Index is also due (exp 98). Have a good weekend

CURRENCIES
EURUSD: 1.2104
Res  1.2130  1.2155  1.2185
Sup  1.2095  1.2050  1.2030
USDJPY: 109.31
Res  109.45  109.65  110.00
Sup  109.20  109.05  108.80
GBPUSD: 1.3915
Res  1.3950  1.3975  1.4000
Sup  1.3895  1.3870  1.3840
USDCHF: 0.9894
Res  0.9900  0.9915  0.9935
Sup  0.9875  0.9850  0.9815
AUDUSD: 0.7554
Res  0.7565  0.7585  0.7600
Sup  0.7545  0.7525  0.7500
NZDUSD: 0.7059
Res  0.7080  0.7095  0.7120
Sup  0.7055  0.7025  0.7000
INDICES / COMMODITIES
S&P.fs: 2674.10
Res  2680.00  2690.00  2700.00
Sup  2660.00  2650.00  2640.00
DJ30.fs: 24303.00
Res  24365.00  24605.00  24820.00
Sup  24200.00  24010.00  23780.00
SPI200.fs: 5939
Res  5945  5960  5975
Sup  5925  5910  5890
XAUUSD: 1317
Res  1320  1325  1330
Sup  1315  1310  1305
XAGUSD: 16.51
Res  16.70  16.85  17.00
Sup  16.40  16.30  16.15
WTI.fs: 68.15
Res  68.55  69.00  69.55
Sup  67.70  67.10  66.50