Allan von Mehren
Danske Bank A/S
Market movers ahead
In the US, we expect a rebound in key non-defence durable goods orders ex. aircraft. US Markit PMI remains at an elevated level and we expect a correction.
Euro area PMIs are expected to increase signalling stronger economic activity.
Greece likely to remain in the spotlight at the upcoming Eurogroup meeting.
In the UK, minutes from the MPC’s April meeting is released. We will look for comments on sterling, wage growth and core inflation.
In China, it is still too early to call the bottom for China’s manufacturing PMI.
In Sweden, we expect another lacklustre outcome from the labour force survey.
Global macro and market themes
We believe we are at a low point in the global business cycle.
US growth to recover from here.
Stock markets playing recovery.
Fed members still signal hike in June-September window.
We see German yields falling still as more maturities go below -0.2%.
We expect EUR/USD to decline on better US data.
Focus
Research UK: We have moved the first BOE hike to November 15
Research: Finnish parliamentary polls point to a new government
FX Forecast Update: Keep calm and carry on
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Editors’ Picks
AUD/USD remained bid above 0.6500
AUD/USD extended further its bullish performance, advancing for the fourth session in a row on Thursday, although a sustainable breakout of the key 200-day SMA at 0.6526 still remain elusive.
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.