Morning Market Update – Pound may Head for Loss

So Far

United States Net Long-Term TIC Flows registered below forecasts ($68.3B) in March: Actual ($59.8B)

United States Total Net TIC Flows dipped from the previous fix of $19.3B to $-0.7B in March

The People’s Bank of China (PBOC) has set the Yuan reference rate at 6.8790 vs the previous day’s fix of 6.8852

The Livesquawk report cited that Fitch ratings expects China’s economy to remain stable this year.

Australia New Motor Vehicle Sales (MoM): 0.3% (April) vs previous 1.9%

Australia New Motor Vehicle Sales (YoY) climbed from previous -3% to 0.1% in April

RBA May meeting when interest rates were held unchanged at 1.5% have been released. The Board continued to keep tabs on the developments in the labor and housing markets. The Board’s assessment was that maintaining the current accommodative stand of monetary policy would be consistent with achieving sustainable growth and the inflation target.

Coming Up

Moving on for the day, we await the Japan’s Tertiary Industry Index (MoM) which looks to continue to hold around the 0.2% area and posted to remain the same.

Italy’s Gross Domestic Product (QoQ) are looked to continue to remain at the same 0.2%, while Gross Domestic Product (YoY) is showing some decline from 1% to forecasted 0.8%

The pound has some major Producer Price Index – Output (YoY) n.s.a which has a slight decline from previous fix of 3.6%, and is forecasted to be at 3.4%. PPI Core Output (MoM) n.s.a too seems to decline at 0.2% against the previous fix of 0.3%. With the Producer Price Index – Output too showing negative signs already, the pound may be heading for some loss for the day. It may be saved in the day with Core Consumer Price Index (YoY) showing better results at 2.2% compared to the previous fix of 1.8%, and a major impact with Consumer Price Index (YoY) which are forecasted strong at 2.6% compared

to previous of 2.3%.

Germany continues to grow, as ZEW Survey have seen, improving in recent times and forecasted at better rate than the previous release.

Euro Gross Domestic Product remained at previous level until any major output comes out. It is posted to show some impact in the day.

Dollar is doing better with some release for the day with notable Building Permits at 1.27M against 1.26M, and the Housing Starts 1.26M compared to the previous fix of 1.215M.
For more detailed analysis from the author, please visit NoaFX.