Forex today breathed a sigh of relief in Thursday’s Asian trading, as the dust settled over the Super Wednesday aftermath that offered no new surprises. The FOMC minutes underscored the Fed’s patience stance while the ECB reiterated that risks to the economy remain skewed to the downside.
Meanwhile, on the Brexit front, the EU struck a final accord and offered a flexible Brexit deadline extension until Oct 31st to the UK, leaving doors open for an early exit if the PM May manages to clinch a Brexit deal. The Cable showed little reaction to the Brexit-related developments and circled around the 1.31 handle, as markets look forward to the UK cross-party Brexit talks for fresh directives. The EUR/USD pair also held onto the higher levels below the 1.13 handle amid broad-based USD weakness.
Among the Asia-pac currencies, the Aussie extended its correction from 2-month tops and tested the 0.7150 support amid risk-aversion and mixed Chinese inflation data while weaker oil prices kept the bounce in the Loonie and the Kiwi limited. USD/JPY wavered in a 20-pips tight range around the 111 level amid negative Asian stocks and Treasury yields, as global growth concerns and US-EU trade war risks dented investors’ sentiment.
Main Topics in Asia
NK's Kim Jong Un says needs to deliver a serious blow to those imposing sanctions - YNA
Australian Prime Minister to call the election - Sky News
Sources: EU leaders agree Brexit delay until October – Reuters
Brexit update: Tusk said EU agree on extension - 31st Oct
Brexit update: Some minor changes are being made to the extension plan
Brexit: Junker/ Tusk & May Presser Q&As - The Guardian
China March CPI 2.3% y/y (expected 2.4%) and PPI 0.4% y/y (expected 0.4%)
Gold Technical Analysis: Bulls perking up and look to test the trend-line resistance
RBA’s Debelle made no comments on monetary policy or economy
US Pres. Trump: EU - a brutal trading partner with the US - Twitter
Report: US-China trade war is rerouting US import flows - Reuters
Key Focus Ahead
After a busy macro calendar a day before, Thursday remains a thin-showing, with nothing much of relevance from the Euroland except for the German final CPI figures, which are likely to have limited impact on the EUR trades. Meanwhile, the UK docket remains data-empty and hence, the GBP traders eagerly await the outcome of the round 2 of the UK cross-party Brexit talks due later today.
Meanwhile, in the NA session, the US PPI numbers, due at 1230 GMT, will headline alongside the releases of the US weekly jobless claims and the Canadian new housing price index.
Besides the macro news, a bevy of global central bankers will be up on the rostrum later today, with the Fedspeaks likely to hog the limelight.
1330 GMT: Fed’s Clarida
Around 1330 GMT Fed’s Williams
1340 GMT: Fed’s Bullard
1700 GMT: BOC’s Wilkins
2000 GMT: Fed’s Bowman
Fed’s Kashkari
EUR/USD firmer, testing weekly highs near 1.1280
The shared currency has recovered the ground lost post-ECB meeting and is now helping EUR/USD to return to the upper end of the range in the 1.1280/5 band.
GBP/USD clings to 50-day SMA, Brexit extension shifts focus to cross-party talks
GBP/USD holds tightly to the 50-day SMA around 1.3100 ahead of the London open on Thursday. The Cable initially took advantage of the EU summit outcome that offered Brexit deadline extension. However, uncertainty surrounding the UK cross-party talks still cap the upside.
Gold Technical Analysis: Bulls perking up and look to test the trend-line resistance
A third test of the key trendline resistance ahead could be on the cards. This level is above the 13 March highs around 1311. A subsequent break of 1311 brings in the 78.6% Fibo of the prior swing high's (25 March) decent.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair keenly awaits the US PCE inflation data and Fed Chair Powell's speech for fresh hints on next week's price action.
GBP/USD holds steady above 1.2600 as markets stay calm on Good Friday
GBP/USD trades sideways above 1.2600 amid a typical Good Friday trading lull. A broadly firmer US Dollar could keep any upside attempts limited in the pair ahead of the US PCE inflation data and Fed Chair Powell's appearance.
Gold price sits at all-time highs above $2,230, US PCE eyed
Gold price hit all-time highs at $2,236 on Thursday to finish Q1 2024 with a bang. Most major world markets, including the US are closed due to Holy Friday, leaving volatility around Gold price highly subdued. US PCE inflation and Powell are awaited.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.