Morning Market Update – Dollar Gives Mixed Responses

Asian Markets

Japan’s foreign bond investment dropped down to ¥-1283.8B last week from a previous ¥-796.2B. Japan’s foreign investment in Japan stocks: ¥258.4B (April 21) versus the previous rate of ¥315.2B. Japan’s life insurance companies have decided to purchase foreign bonds at a slower rate. The reason behind the slow purchases is that the Federal Reserve is expected to raise the interest rates two more times this year. Australia’s import price index (QoQ) went up from a previous 0.2% to 1.3% in 1Q. Australia’s export price index (QoQ) dropped down to 9.4% in 1Q from a previous 12.4%. The People’s Bank of China (PBOC) set the Yuan midpoint rate/reference rate at 6.8896 versus yesterday’s fix of 6.8845.

So Far

Moving on for the day, we have some major releases for Japan starting with the Bank of Japan’s (BoJ) Monetary Policy Statement and Interest Rate Decisions. BoJ is likely to keep the policy unchanged and stated that it may continue for some time. The analysts are likely to lower their inflation expectations due to the monetary policy.

Germany Gfk Consumer Confidence survey may have a slight edge when compared to the previous release at 9.8 and is forecasted to be at 9.9. We have some major news for the Euro. The National Australian Bank’s (NAB) analysts commented on the Euro’s monetary policy and said that “the ECB meeting is the highlight in Europe and again like Japan, a no change in policy is unanimously expected. Economic activity indicators are also at a six year high, but with the inflation wobble in March we suspect the Bank and President Draghi will look to keep things stable and wait until the June meeting to make any shift to its forward guidance.”

The greenback seems to give a mixed response for the day. The Initial Jobless Claims shows a minor improvement with 241k when compared to the previous release of 244k. The Durable Goods Orders ex Transportation is forecasted to be at a negative 0.4% against 0.5%. The Pending Home Sales (MoM) does not help the greenback as they have a negative forecast of 1.0% than the previous release of +5.5%.
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