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Forex Today: US Congress deal hopes boost risk, Dollar licks wounds; Eurozone PMIs – key

Dhwani Mehta FXStreet

A better market mood emerged in Asia on Tuesday, as the overall sentiment was boosted by the progress on the coronavirus economic relief deal worked on by the US Congress. Further, the Fed’s unlimited QE eased the pressure off the credit markets and pushed the US dollar further south while reviving the risk-on trades. The looming concerns about the virus-led lockdowns across the globe and its economic fallout took a back seat for now.

The US stocks futures rallied alongside the US Treasury yields and Asian markets, as the Japanese stocks surged over 7%. Gold prices extended the overnight gains and tested the 1600 level on Fed’s aggressive easing. Oil prices also rebounded amid a risk-on market profile.

Within the G10 currency markets, most majors extended the rebound on the extension of the losses in the US dollar across the board. The Aussie, however, outperformed and jumped as high as 0.5950, tracking the solid rise in gold and oil prices. The Kiwi also rallied 1% and briefly regain 0.5800 while USD/CAD lost 0.50% to test the bids just below the 1.4400 level. USD/JPY extended the drop but found support just above 110.00, rescued by the rally in equities.

Meanwhile, EUR/USD, on the other hand, held onto the recovery gains around 1.0800 while the Cable defended the 1.1600 mark amid stringent measures deployed by the UK PM Johnson to battle the virus spread.

Main topics in Asia

US VP Pence: We ask lawmakers to speed up the approval of the support package…

US President Trump: Called Fed’s Powell on Monday, told him he did a good job

China cites Hubei has 1 additional COVID-19 March 23

NZ confirms 40 new cases Of COVID-19

Mnuchin: Very close to deal on COVID-19 stimulus bill

US inflation expectations rise from decade lows on Fed's unlimited QE

South Korea stats: 76 new COVID-19 cases in 24 hours, total 9037

Beijing Govt: All overseas arrivals will be subject to centralised quarantine

US domestic passenger flights could virtually shut down, voluntarily or by government order – WSJ

RBA pumps liquidity, proposes bond buys to ease financial conditions, AUD/USD rallies 2%

NZ FinMin Robertson: Govt to set up NZD $6.25 bn business financing guarantee scheme

S. Korean Pres. Moon announces a total 100 trln won worth of market packages to fight coronavirus

S&P 500 futures and yields rise while US dollar drops on Fed's unlimited QE

US Pres. Trump: Republicans should not agree to Democrat stimulus measures

Canada to introduce new powers to spend, raise taxes without Parliamentary approval

BOJ’s Kuroda: Closely monitoring the market moves

BOJ: Banks borrow record $89.3 billion from dollar funding operations

Key focus ahead

Markets brace for a busy EUR macro calendar this Tuesday, with the Preliminary Markit Manufacturing and Services Purchasing Manufacturing Index (PMI) reports from across the Euro area and the UK, trickling in from 0815 GMT, to dominate, as they will suggest a sharp contraction in the business activity, in part due to the coronavirus impact.

Also, in focus remains the Constitutional Court Ruling on the European Central Bank (ECB) QE legality and UK’s CBI Industrial Trends Survey – Orders due later in the European session.

The NA session also sees the key US Markit Manufacturing and Services PMIs, followed by the New Homes Sales data and US API Weekly Crude Oil Stock report.

The US Congress relief deal will be closely eyed while coronavirus updates-driven broad risk sentiment and dollar price-action will continue to influence the markets.

EUR/USD: Dollar weakness powers gains, Eurozone PMIs eyed

The anti-greenback sentiment triggered by the Federal Reserve's (Fed) open-ended asset purchase program is boding well for the EUR and helping EUR/USD gain altitude. The spot, however, may come under pressure if the Eurozone and German preliminary Manufacturing PMIs disappoint.

GBP/USD: Firmer above 1.1600 ahead of UK/US Purchasing Managers Index

GBP/USD benefits from the broad US dollar weakness. The UK PM announces the most stringent rules post World War II to tame the coronavirus. The preliminary PMI data is likely to portray the first impressions of the deadly virus on the key activities.

Eurozone PMIs Preview: How calamitous is the coronavirus carnage? Three scenarios for EUR/USD

Eurozone PMIs are set to plunge in response to the devastating coronavirus crisis. French figures could have a more significant impact than usual due to their timing.

UK PMIs Quick Preview: First coronavirus-linked read is a lose-lose situation for GBP/USD

Markit's preliminary PMIs for March are expected to drop to contraction territory amid the coronavirus crisis. The data has been collected before stricter lockdown measures have been collected.

GMT	Event	Actual	Consensus	Previous
Monday, Mar 23
22:00	AUD Commonwealth Bank Manufacturing PMI	50.1	50.0	50.2
22:00	AUD Commonwealth Bank Services PMI	39.8	48.3	49.0
Tuesday, Mar 24
00:30	JPY Jibun Bank Manufacturing PMI	44.8	47.6	47.8
24h	ARS Day of Remembrance for Truth and Justice
05:00	EUR Export Prices (YoY)			-1.3%
05:00	EUR Import Prices (YoY)			0.1%
05:00	EUR Unemployment Rate			6.8%
05:00	EUR Producer Price Index (YoY)			-1.6%
05:00	JPY Leading Economic Index	90.5	90.3	90.9 Revised from 90.3
05:00	JPY Coincident Index	95.2	94.7	94.4 Revised from 94.7
08:15	EUR Markit Manufacturing PMI		40.0	49.8
08:15	EUR Markit Services PMI		41.5	52.5
08:15	EUR Markit PMI Composite		38	52
08:30	EUR Markit PMI Composite		39.1	50.7
08:30	EUR Markit Services PMI		42.5	52.5
08:30	EUR Markit Manufacturing PMI		40	48
n/a	EUR Constitutional Court Ruling on ECB QE Legality
09:00	PLN Unemployment (MoM)		5.5%	5.5%
09:00	EUR Markit PMI Composite		37.8	51.6
09:00	EUR Markit Manufacturing PMI		39.0	49.2
09:00	EUR Markit Services PMI		38.4	52.6
09:30	GBP Markit Manufacturing PMI		45.0	51.7
09:30	GBP Markit Services PMI		45.0	53.2
09:30	GBP FPC Meeting Minutes
11:00	GBP CBI Industrial Trends Survey - Orders (MoM)		-30	-18
12:00	BRL Retail Sales (MoM)		0.2%	-0.1%
12:00	MXN 1st half-month Inflation		0.18%	0.12%
12:00	MXN 1st half-month Core Inflation		0.25%	0.22%
12:55	USD Redbook Index (MoM)			1.1%
12:55	USD Redbook Index (YoY)			8.5%
13:00	HUF MNB Interest Rate Decision		0.9%	0.9%
13:30	EUR Current Account Balance EUR			€-328B
13:45	USD Markit Manufacturing PMI		43.0	50.7
13:45	USD Markit Services PMI		42.0	49.4
13:45	USD Markit PMI Composite			49.6
14:00	USD New Home Sales (MoM)		0.750M	0.764M
14:00	USD New Home Sales Change (MoM)		-2.3%	7.9%
14:00	USD Richmond Fed Manufacturing Index		9	-2
15:30	USD 52-Week Bill Auction			1.27%
17:00	USD 2-Year Note Auction			1.188%
24h	IDR Hari Raya Nyepi
20:30	USD API Weekly Crude Oil Stock			-0.421M
24h	EUR Independence Day
21:45	NZD Exports			$4.73B
21:45	NZD Trade Balance (YoY)			$-3.87B
21:45	NZD Imports			$5.07B
21:45	NZD Trade Balance (MoM)			$-340M
23:50	JPY BoJ Summary of Opinions
Wednesday, Mar 25
01:00	NZD RBNZ Interest Rate Decision			0.25%
01:00	NZD RBNZ Rate Statement
05:30	EUR Gross Domestic Product n.s.a (YoY)		1.5%	1.5%
05:30	EUR Gross Domestic Product s.a (QoQ)		0.4%	0.4%
07:00	TRY Manufacturing Confidence			106.9
07:00	TRY Capacity Utilization			76%
07:00	NOK Labour Force Survey		3.9%	3.9%
07:05	THB BoT Interest Rate Decision			1%
08:00	EUR Industrial Production (YoY)			-5.3%
08:30	SEK Producer Price Index (YoY)		-1.8%	-0.4%
08:30	SEK Producer Price Index (MoM)		0%	-1%
09:00	EUR IFO - Business Climate		87.7	87.7
09:00	EUR IFO - Current Assessment		93.7	93.8
09:00	EUR IFO - Expectations		82	82
n/a	CHF ZEW Survey - Expectations			7.7
09:30	GBP Retail Price Index (YoY)		2.5%	2.7%
09:30	GBP Retail Price Index (MoM)		0.5%	-0.4%
09:30	GBP DCLG House Price Index (YoY)		2.4%	2.2%
09:30	GBP Producer Price Index - Output (MoM) n.s.a		0.0%	0.3%
09:30	GBP Producer Price Index - Output (YoY) n.s.a		1.4%	1.1%
09:30	GBP PPI Core Output (MoM) n.s.a		0.0%	0.1%
09:30	GBP Producer Price Index - Input (YoY) n.s.a		-0.9%	2.1%
09:30	GBP PPI Core Output (YoY) n.s.a		0.5%	0.7%
09:30	GBP Producer Price Index - Input (MoM) n.s.a		-2.0%	0.9%
09:30	GBP Consumer Price Index (YoY)		1.6%	1.8%
09:30	GBP Core Consumer Price Index (YoY)		1.5%	1.6%
24h	GBP Consumer Price Index (MoM)		0.3%	-0.3%
11:00	USD MBA Mortgage Applications			-8.4%
11:00	GBP CBI Distributive Trades Survey - Realized (MoM)			1%
11:30	INR M3 Money Supply		9.5%	9.4%
12:00	MXN Retail Sales (YoY)		3.0%	3.2%
12:00	MXN Retail Sales (MoM)		0.5%	-0.4%
12:30	USD Durable Goods Orders ex Defense		-0.9%	3.7% Revised from 3.6%
12:30	USD Durable Goods Orders ex Transportation		-0.3%	0.8% Revised from 0.9%
12:30	USD Nondefense Capital Goods Orders ex Aircraft		-0.5%	1.1%
12:30	USD Durable Goods Orders		-0.8%	-0.2%
12:30	BRL Current Account		$-3.321B	$-11.879B
13:00	USD Housing Price Index (MoM)		0.3%	0.6%
13:00	EUR Leading Indicator			-2.7
13:00	CHF SNB Quarterly Bulletin
14:30	USD EIA Crude Oil Stocks Change		3.086M	1.954M
17:00	USD 5-Year Note Auction			1.15%
19:00	ARS Gross Domestic Product (YoY)			-1.7%
23:50	JPY Corporate Service Price Index (YoY)		2.2%	2.3%
23:50	JPY Foreign Bond Investment			¥-595.1B
23:50	JPY Foreign Investment in Japan Stocks			¥-1,242.9B
Thursday, Mar 26
05:00	SGD Industrial Production (YoY)		-4.0%	3.4%
05:00	SGD Industrial Production (MoM)		-9.6%	18.2%
07:00	EUR Gfk Consumer Confidence Survey		7.1	9.8
07:45	EUR Business Climate		93	102
08:00	SEK Consumer Confidence (MoM)		98.8	98.5
08:30	SEK Trade Balance (MoM)		-5.2B	9.9B
09:00	EUR Trade Balance non-EU			€-0.28B
09:00	EUR M3 Money Supply (YoY)		5.2%	5.2%
09:00	EUR M3 Money Supply (3m)			5.2%
09:00	EUR Private Loans (YoY)		3.8%	3.7%
09:00	EUR Economic Bulletin
09:30	ZAR Producer Price Index (MoM)		0.2%	0.3%
09:30	ZAR Producer Price Index (YoY)		4.4%	4.6%
09:30	GBP Retail Sales (YoY)		0.8%	0.8%
09:30	GBP Retail Sales (MoM)		0.2%	0.9%
09:30	GBP Retail Sales ex-Fuel (YoY)		1.1%	1.2%
09:30	GBP Retail Sales ex-Fuel (MoM)		-0.1%	1.6%
12:00	MXN Jobless Rate		3.4%	3.8%
12:00	MXN Jobless Rate s.a			3.7%
12:00	GBP BoE Asset Purchase Facility			£645B
12:00	GBP BoE Interest Rate Decision		0.25%	0.10%
12:00	GBP Monetary Policy Summary
12:00	GBP Bank of England Minutes
12:00	GBP BoE MPC Vote Hike			0
12:00	GBP BoE MPC Vote Cut			9
12:00	GBP BoE MPC Vote Unchanged			0
12:00	CZK CNB Interest Rate Decision			1.75%
12:30	USD Continuing Jobless Claims		1.708M	1.701M
12:30	USD Initial Jobless Claims 4-week average			232.25K
12:30	USD Initial Jobless Claims		750K	281K
12:30	USD Gross Domestic Product Annualized		2.1%	2.1%
12:30	USD Gross Domestic Product Price Index		1.3%	1.3%
12:30	USD Wholesale Inventories		0.0%	-0.4%
12:30	USD Goods Trade Balance			$-65.9B Revised from $-65.5B
12:30	USD Personal Consumption Expenditures Prices (QoQ)		1.3%	1.3%
12:30	USD Core Personal Consumption Expenditures (QoQ)		1.2%	1.2%
13:00	RUB Central Bank Reserves $			$581B
14:30	USD EIA Natural Gas Storage Change		33B	-9B
15:00	USD Kansas Fed Manufacturing Activity		2	8
15:30	USD 4-Week Bill Auction			0.03%
17:00	USD 7-Year Note Auction			1.247%
19:00	MXN Central Bank Interest Rate			7%
19:00	ARS Unemployment Rate (QoQ)			9.7%
19:00	ARS Trade Balance (MoM)			$1,015M
21:00	KRW Consumer Sentiment Index		64.8	96.9
21:00	NZD ANZ – Roy Morgan Consumer Confidence			122.1
21:45	NZD Total Filled Jobs			2.2M
23:30	JPY Tokyo Consumer Price Index (YoY)		0.5%	0.4%
23:30	JPY Tokyo CPI ex Fresh Food (YoY)		0.4%	0.5%
23:30	JPY Tokyo CPI ex Food, Energy (YoY)		0.7%	0.7%
Friday, Mar 27
06:00	EUR Industrial Confidence			-3
06:00	EUR Consumer Confidence			-4.5
07:00	TRY Economic Confidence Index			97.5
07:00	GBP Nationwide Housing Prices n.s.a (YoY)		2.0%	2.3%
07:00	GBP Nationwide Housing Prices s.a (MoM)		0.1%	0.3%
07:00	NOK Retail Sales			0.5%
07:45	EUR Consumer Confidence		91	104
08:00	EUR Purchasing Manager Index			50.2
08:00	HUF Unemployment Rate (3M)			3.4%
08:30	SEK Retail Sales (MoM)		0.0%	0.9%
08:30	SEK Retail Sales (YoY)		1.6%	2.7%
09:00	EUR Business Confidence		90.0	100.6
09:00	EUR Consumer Confidence		100.5	111.4
09:30	ISK Consumer Price Index (MoM)			0.9%
09:30	ISK Consumer Price Index (YoY)			2.4%
11:00	EUR Retail Sales (YoY)			3.7%
11:00	EUR Retail Sales (MoM)			-3.4%
n/a	INR Bank Loan Growth		5.9%	6.1%
12:00	MXN Trade Balance s/a, $		$0.124B	$1.940B
12:00	MXN Trade Balance, $		$0.428B	$-2.416B
n/a	GBP BoE Quarterly Bulletin
12:30	USD Personal Income (MoM)		0.4%	0.6%
12:30	USD Personal Consumption Expenditures - Price Index (MoM)		0.1%	0.1%
12:30	USD Core Personal Consumption Expenditure - Price Index (MoM)		0.2%	0.1%
12:30	USD Personal Consumption Expenditures - Price Index (YoY)			1.7%
12:30	USD Personal Spending		0.2%	0.2%
12:30	USD Core Personal Consumption Expenditure - Price Index (YoY)		1.7%	1.6%
n/a	INR FX Reserves, USD			$481.89B
15:00	USD Michigan Consumer Sentiment Index		90.0	95.9
17:00	USD Baker Hughes US Oil Rig Count			664
18:00	EGP CBE Interest Rate Decision			12.25%
20:30	USD CFTC Oil NC Net Positions			440.2K
20:30	USD CFTC Gold NC Net Positions			$281.9K
20:30	USD CFTC USD NC Net Positions			$17K
20:30	GBP CFTC GBP NC Net Positions			£18.6K
20:30	JPY CFTC JPY NC Net Positions			¥32.9K
20:30	EUR CFTC EUR NC Net Positions			€32.5K
20:30	AUD CFTC AUD NC Net Positions			$-28.7K
21:00	COP Interest rate		4.25%	4.25%

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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