FX News Today
- The RBNZ became the first central bank in the developed world to begin loosening policy this cycle. NZDUSD drifted to 6-month low at 0.6525.
- German industrial production unexpectedly rose 0.5% m/m in March.
- Given the correction in orders in Q1 and manufacturing PMI readings that show the manufacturing sector in recession, not just in Germany, the better than expected German production number for March doesn’t change the overall picture of weakness in a sector that clearly is pressured by the combination of geopolitical trade tensions and Brexit jitters, with no sign of improvement, despite today’s upside surprise in the headline reading.
- The weaker than expected trade data out of China showed exports contracting and the trade surplus falling sharply added to ongoing concerns about developments in world trad.
- Brexit fatigue has driven the pound lower vs most other currencies today
- The front end WTI future is trading at USD 61.78 per barrel.
Charts of the Day
Technician’s Corner
- EURUSD dropped to lows under 1.1170 after opening near 1.1200. The downward move came partly on safe-haven flows into the Dollar. Resistance comes at 1.1222, the 20-day MA, with support seen at 1.1135, Friday’s low.
- USDJPY has fallen to 110.16 lows, just below Monday’s 1-month base of 110.29. The pairing has been weighed down by another risk-off session, related to the escalating US/China trade war. Wall Street is sharply lower, while Treasury yields are down again today as well. Further equity losses will likely see the Dollar head below yesterday’s low, which them brings the March 25 bottom of 109.70 into focus
Main Macro Events Today
- Canadian Housing Starts – April housing starts are expected to improve to 195.0k from 192.5k in March.
Support and Resistance levels
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Andria Pichidi
Market Analyst
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