The dollar index drops as far as 93.95

Good Morning,

- Euro trade near a 2-month peak at 1.1382 on rising European yields and weak U.S. data. The euro was last at $1.1360 level.

- Asian stocks fell, led by losses on Wall Street last night. U.S. stocks fell sharply ended on Wednesday after Fed’s Chair Janet Yellen warned of high share valuations, adding to anxiety about future interest rates.

- Weak U.S. indicators yesterday also added to uncertainty regarding when the first rate hike by the Fed could take place. Data on Wednesday showed tepid private job gains and a second straight quarterly decline in productivity.

- The dollar index drops as far as 93.95, its lowest since mid-February and last stood at 94.14. It has fallen more than 6 percent from a 12-year peak of 100.39 set in March.

- Fed’s Lockhart said market expectations for a September interest rate hike were in "reasonable alignment" with the central bank.

- German 10-year bond yields hit a four-month high of 0.595 percent overnight. Just last month it had hit a record low of 0.05 percent, when hopes were high that the ECB's trillion euro bond buying quantitative easing programme would drive the yield into negative territory. French, Dutch, Belgian and Austrian equivalent bond yields also scaled 2015 peaks on Wednesday.

- British pound lost some ground ahead of Britain's election later in the day. The Conservative and the opposition Labour Party have been neck and neck in opinion polls that indicate Britain could be in store for a hung parliament and another coalition government.

- German’s new orders in manufacturing in March 2015 increased a seasonally and working-day adjusted 0.9% on February 2015.

- The consumer survey conducted in April 20151 indicates that the consumer climate in Switzerland remained unchanged in relation to the situation in January. Nevertheless, the assessment of previous economic trends (over the past twelve months) worsened and expected prices trends were lowered considerably.

- Credit Suisse on EUR/USD: CS notes that it reversed early selling yesterday to bounce back to fresh recovery highs after breaking above 1.1292 – the 23.6% retracement of the 2014/15 fall. "We would expect selling to show here, but above it can target 1.1389 next, then 1.1450, with a bigger barrier seen at 1.1534. Bigger picture, we would not rule out a move to 1.1808/11," CS projects. "Support shows at 1.1109, followed by 1.1066/65 and then 1.1030. Below the latter is needed to see scope for 1.0972/60, through which can ease the topside risk, for 1.0916/06," CS adds. In line with this view, CS maintains a long EUR/USD position from around 1.1105, with a stop below 1.0960, and a target at 1.1445.

- Japan service sector activity returns to growth in April, following two months of decline. New orders in the service sector increase at fastest rate since November 2014.

- Australian employers unexpectedly cut jobs in April as a mining investment boom unwinds and a resilient currency weakens the competitiveness of local industries. The number of people employed fell by 2,900 from a month earlier, compared with economists’ forecasts for a 4,000 gain, government data showed Thursday. The jobless rate rose to 6.2 percent from 6.1 percent.

- Oil prices fell after hitting 2015 highs yesterday as an OPEC delegate indicated the group would stick to its strategy of pursuing market share rather than cutting output and traders took profit from a multi-week rally.

- Watch today: German factory orders, French industry, US jobless.

Have a nice Day!