Chinese data shows a slowdown in the economy. Retail sales, investments in fixed assets, industrial production - all these figures significantly below expectations in April. The effect of monetary policy easing in previous months and weeks has not yet reached the economy. What is even more disturbing is that the Chinese economy may need even more stimulus.

China

Stocks

Key US stock indexes on Tuesday raised around 0.8%, offsetting a third of decline at the start of the week. Chinese China A50 jumped 2.5% on Wednesday, showing a more confident rebound. However, this growth, as we noted the day before, do not look steady. Futures on the S&P 500 lost a positive momentum, trading virtually unchanged from the beginning of the day. The yield on 10-year government bonds fell to 2.38% —minimum levels since March, reflecting increased demand for defensive assets and could turn into increased pressure on stock indexes later in the day.

USSPX500

EURUSD

The single currency returned to 1.1200, developing a retreat from the resistance of the downward channel and the MA50. Germany's ZEW business sentiment index unpleasantly surprised yesterday. Instead of growth, which was predicted by market analysts, the index returned to negative territory. Escalation of trade disputes has a negative effect on business sentiment in Germany, despite the fact that assessments of the current state are gradually improving. EURUSD may again be under pressure if there is an increase in demand for defensive assets in global markets, and because of this, the pair may remain within the downward channel from the beginning of the year.

EURUSD

Chart of the day: AUDUSD

The Australian dollar declines to 3-year lows area against the dollar. Since the middle of last month, AUDUSD has lost about 4%, increasing the decline in the downward trend. Weak data from China and the persistence of fears around trade wars fuel pressure on the Australian dollar. After 2003, AUDUSD was below 0.700 only during periods of highest fears around the state of the global and Chinese economies. A decrease to these levels can serve as an indicator of increasing tension on the part of investors, despite some rollback of stock markets. Tomorrow morning, the Australian labor market will be in the spotlight. It remains strong, and a new batch of good data may ease some of the pressure on the Aussie.

AUDUSD

Disclaimer

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD consolidating its losses amid Brexit and trade uncertainty

EUR/USD is off the weekly highs but holds onto 1.11 amid uncertainty about the Brexit process and doubts that the US and China can reach a deal. Tension toward the ECB meeting mounts.

EUR/USD News

GBP/USD attempting to recover after parliament slowed down the Brexit process

GBP/USD is moving up toward 1.29, trying to recover after parliament rejected the fast-track process that PM Johnson wanted for approving his Brexit deal. An extension to Article 50 and elections are on the cards.

GBP/USD News

USD/JPY struggles below mid-108.00s, over one-week lows

The Greenback held weaker against its Japanese counterpart, with the USD/JPY pair struggling below mid-108.00s, or over one-week lows set earlier this Wednesday.

USD/JPY News

Cryptocurrencies price prediction: Bitcoin Cash, Ethereum & IOTA

The crypto market is bleeding across the board. Major cryptos like Bitcoin and Ethereum fall overnight while Bitcoin Cash engaged the reverse gear during Wednesday’s European session.

Read more

Gold climbs higher toward $1,500 on risk-aversion

The XAU/USD pair gained traction on Wednesday and rose toward the upper-limit of its two-week-old range near the critical $1,500 handle supported by risk-off flows.

Gold News

Forex Majors

Cryptocurrencies

Signatures