Forex news from the European morning session - 17 April 2019
Headlines:
- US MBA mortgage applications w.e. 12 April -3.5% vs -5.6% prior
- China is said to weigh stimulus measures to bolster consumption
- Germany cuts 2019 GDP growth forecast to 0.5% from 1.0%
- Eurozone February trade balance €19.5 billion vs €17.0 billion prior
- Eurozone March final core CPI +0.8% vs +0.8% y/y prelim
- ECB's Hansson: No reason to doubt that growth will pick up in 2H 2019
- UK March CPI +0.2% vs +0.2% m/m expected
Markets:
- AUD leads, NZD lags on the day
- European equities higher; E-minis up 0.2%
- US 10-year yields up 1.3 bps to 2.603%
- Gold flat at $1,276.56
- WTI up 0.6% to $64.40
- Bitcoin up 0.8% to $5,226
Markets generally held steady since Asian trading with major currencies not really breaking stride following earlier moves before the start of European morning trade. The aussie remains the leader after Chinese economic data helped to ease fears on global growth.
AUD/USD continues to sit around 0.7190-05 levels throughout the session as buyers flirt with a firm break above the 200-day moving average for the first time since March 2018.
Meanwhile, the kiwi remains the laggard after NZ Q1 CPI data disappointed expectations. NZD/USD fell to a low of 0.6668 in Asian trading but recovered to around 0.6720-30 at the start of European trading. The pair then held steady around 0.6720-40 levels throughout the session as kiwi traders wrap their heads around odds of a RBNZ rate cut next month.
The dollar is a tad weaker on the day as the euro is showing some poise as German bond yields rise to four-week highs. EUR/USD holds above the 1.1300 handle but upside remains limited by resistance around 1.1325-30 ahead of US trading.
USD/JPY traded in a more subdued manner as the pair ranged between 111.90-05 for the most part with the yen also on the weaker side as bond yields are inching up.
Other than that, the pound was a notable mover as it fell slightly after UK CPI data disappointed expectations. Cable fell from 1.3060 to 1.3040 but has recovered to stay near flat levels around 1.3050-55 currently as traders continue to wait on fresh Brexit developments for further trading clarity.
Looking ahead, markets are a tad more optimistic as they remain buoyed by relief from Chinese data in Asian trading so just be wary of any potential risk-on extension to follow in the North American trading session.
