Current Sentiment:
Yesterday's Retail Sales from UK saw GBP well supported throughout the entire New York session and Cable remains near highs.
In the late NY session price action was subdued despite three data sets being released from the US; Initial Jobless Claims came in very close to expectations while the 4-week Average Jobless Claims dropped to a 15 year low of 266k; US Existing Home Sales and Philadelphia Federal Reserve Business Index both came in lower than expected but the greenback did not sell off after the release.
In Asian trade Kiwi has rallied over 100 pips from yesterday's lows as the market re-adjusts to the budget forecasts revealed yesterday which saw inflation at a higher level in 2016 than previously expected. The OIS market is now pricing in a 44% chance of a cut in June, down from 48% previously.
The BOJ had their MP meeting and kept QE unchanged at ¥80 trillion per annum as expected. They raised their view of the Japanese economy and see an elevation in private consumption in the time ahead. The upgraded economic assessment reduces chances of further stimulus; yen strengthened and USDJPY is down nearly 40 pips from session highs.
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