Morning Market Update – Greenback Looks Weak

Asian Markets

Statistics New Zealand revealed that the consumer prices rose by 2.2 percent in the first quarter of 2017 and the household utilities increased by 3.3 percent on year. The data released by the Japanese Ministry of Finance on Thursday morning showed an improvement in the exports sector and expanded continuously since then.

The exports jumped by 12% y/y, beating the estimate of 6.7% and the imports expanded by 15.8% y/y, beating the estimate of 10.4%. The trade surplus stood at JPY 614.7 billion in March. Japanese finance minister Taro Aso stated that Japan cannot leave fiscal discipline as doing so could trigger inflation which might hurt the economy. Also, he said that Japan must eventually raise tax and device measures to increase inflation. The People’s Bank of China (PBOC) set the Yuan reference rate at 6.8792 versus yesterday’s fix of 6.8664. The National Australian Bank reported today that Australia’s business confidence improved slightly in Q1 2017.

Other Markets

Moving on for the day, we have the German Producer Price Index (YoY) and Producer Price Index (MoM).  Though the MoM may see a slight downfall, it should not be of much concern and cause any major changes to the market.

The Counting Jobless Claims released by the US Department for the greenback seems to be doing better when compared to the previous data release which is forecasted at 2.02M. The Philadelphia Fed Manufacturing Survey which is forecasted at 25 could be the reason for the decline of the greenback. The Initial Jobless Claims released are forecasted at 242K than the previous data and any further damage can pull the greenback further down. We shall closely watch for the output of the greenback which seems to be weak for the day.

The Consumer Confidence released by the European Commission is at a negative 4.5 when compared to the previous data release at a negative 5. Though there is not much difference, the results show a positive direction for the Euro in the upcoming session.

We have an important speech from the Bank of England’s Governor Mark Carney. UK Prime Minister Theresa May surprised everyone by proposing a General Election on 8th June. We end the week with US Treasury Secretary Steven Mnuchin’s speech.
For more detailed analysis from the author, please visit NoaFX.