The Australian and New Zealand Dollars floundered amid risk aversion in overnight trade as Asian stock exchanges followed Wall Street downward.
Talking Points:
Aussie, NZ Dollars Sink as on Risk Aversion as Asian Stocks Follow Wall St. Lower
Euro May Correct Lower if March’s Final German CPI Print is Revised Downward
US Dollar May Find Fuel for a Modest Bounce in PPI, UofM Confidence Figures
The Australian and New Zealand Dollars underperformed in overnight trade, sliding as much as 0.4 and 0.6 percent respectively against their major currency counterparts. The sentiment-linked currencies tracked a selloff across Asian stock exchanges downward. The MSCI Asia Pacific regional benchmark equity index slid 1 percent in a move that seemed to follow on from blood-letting on Wall Street earlier in the day.
The final revision of March’s German CPI reading headlines an otherwise quiet European economic calendar. Initial estimates putting the benchmark year-on-year inflation rate at 1 percent – the lowest since June 2010 – are expected to be confirmed. While deepening disinflation is a familiar narrative for Germany and the Eurozone as a whole at this point, a downward revision may still have some market-moving potential for the Euro if profit-taking is triggered after four consecutive days of gains.
Later in the day, the spotlight shifts to US PPI data and University of Michigan Consumer Confidence gauge. Wholesale inflation is expected to narrowly accelerate in March after hitting a nine-month low in February. The sentiment index is likewise seen posting a mild improvement in April after registered at the weakest level in since November in the prior month. The US Dollar is on pace to produce its worst selloff in six months after five consecutive days of losses. Against such a backdrop, it is feasible that even a tepidly upbeat round of economic data may spark a corrective bounce into the week-end. Securing lasting upward follow-though is another matter altogether however.
Critical Levels
FXCM, L.L.C.® assumes no responsibility for errors, inaccuracies or omissions in these materials. FXCM, L.L.C.® does not warrant the accuracy or completeness of the information, text, graphics, links or other items contained within these materials. FXCM, L.L.C.® shall not be liable for any special, indirect, incidental, or consequential damages, including without limitation losses, lost revenues, or lost profits that may result from these materials. Opinions and estimates constitute our judgment and are subject to change without notice. Past performance is not indicative of future results.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.