The price action in the NY session was choppy to say the least, but ultimately the ''risk'' trades won out as the Fed statement suggested the worst of the declines in the US economy are behind us. The communique noted that ''the economy has continued to contract, though the pace of contraction appears to be somewhat slower'' and that ''household spending has shown signs of stabilizing'' to boot. Earlier in the session, the 1Q GDP report showed some ''green shoots'' despite the headline dropping a sharper than expected -6.1%. The 2.2% jump in personal consumption and the fact that nearly half of the headline decline was due to the continued inventory correction was enough to see the markets brush off the initial disappointment.

Most of the price action on the back of the risk rally was in the JPY crosses and commodity currencies. Euro was mixed as the Fed did not make changes to its quantitative easing program, which would have been a US dollar negative if expanded further. EUR/USD ended the session up a modest 15 pips near 1.3275 and we would expect the 1.3340 area to provide good resistance on any squeeze higher overnight. The yen crosses were bid with USD/JPY jumping 70 pips to 97.60/70 while EUR/JPY edged about 110 points higher towards 129.60/70. AUD/USD rallied as well as the better tone to US growth bodes well for the global economy. The pair added 80 pips into the 0.7270 area.

The Reserve Bank of New Zealand cut rates by -50 basis points to 2.50% as the NY session was closing out. This was in line with market expectations but the dovish comments from Bollard, who noted that rates could go lower and will stay low until the latter part of 2010, sent NZD reeling. Kiwi dropped a quick -100 pips on the news towards the 55hr moving average support currently at 0.5636. Look for more support into 0.5600 and 0.5530 on the follow.

Upcoming Economic Data Releases (Asia Session) prior expected

  • 4/29/2009  22:45 GMT NZ  Building Permits MoM  MAR  11.60%  - -
  • 4/29/2009  23:01 GMT UK  GfK Consumer Confidence Survey  APR  -30  -28
  • 4/29/2009  23:15 GMT JN  Nomura/JMMA Manufacturing PMI  APR  33.8  - -
  • 4/29/2009  23:50 GMT JN  Industrial Production (MoM)  MAR P  -9.40%  0.80%
  • 4/29/2009  23:50 GMT JN  Industrial Production (YoY)  MAR P  -38.40%  -34.70%
  • 4/30/2009  0:00 GMT AU  Conference Board Leading Index  FEB  -0.60%  - -
  • 4/30/2009   JN  BoJ Monetary Policy Meeting  28-Apr  
  • 4/30/2009  1:00 GMT AU  HIA New Home Sales (MoM)  MAR  3.90%  - -
  • 4/30/2009  1:30 GMT AU  Private Sector Credit MoM%  MAR  0.00%  0.30%
  • 4/30/2009  1:30 GMT AU  Private Sector Credit YoY%  MAR  5.40%  4.80%
  • 4/30/2009  1:30 GMT AU  NAB Business Confidence  1Q  -42  - -
  • 4/30/2009   JN  BOJ Target Rate  30-Apr  0.10%  0.10%
  • 4/30/2009  4:00 GMT JN  Vehicle Production (YoY)  MAR  -56.20%  - -
  • 4/30/2009  5:00 GMT JN  Housing Starts (YoY)  MAR  -24.90%  -22.60%
  • 4/30/2009  5:00 GMT JN  Annualized Housing Starts  MAR  0.866M  0.865M
  • 4/30/2009  5:00 GMT JN  Construction Orders (YoY)  MAR  -24.90%  - -