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15 May 2015
Antipodean currencies sold, batch of US data eyed
FXStreet (Bali) - The US Dollar garnered a modest flip to the upside along a low key Asian session, with a virtually empty calendar not lending any support to stimulate prices. Despite an uneventful calendar, an announcement by NZ Fonterra cutting its 12-month forecast on GDT offer volumes/milk powder resulted in a brief sell-off in the Kiwi/Aussie, in the tune of 30/40 pips, before a tepid correction.
AUD/USD saw a sharp decline from 0.8090s to test 0.8045 day low before bargain hunting stepped in to buy some cheap Aussie, helping to settle the rate in the 0.8060 vicinity. NZD/USD skid down as well, visiting intraday area of support at 0.7450/55. USD/JPY saw some demand flows off 119.17 NY close, lifting up the rate some 20 odd pips towards 119.40 session highs. The Nikkei 225 caught a bid tone, up 0.43% heading into the close, after tracking gains seen in Wall Street, where the SP500 is a whisker away from new ATHs. Today in Japan, Domestic Corporate Goods Price Index (YoY) came in at -2.1% in April as expected.
Main headlines in Asia
Most economists see Fed rate hike in Sept - WSJ poll
Kiwi falls as Fonterra cuts forecasts
Heading into Europe
There are no events to take not of during the European session, with all the focus now shifted to a new batch of US data, with so far a sense of disappointment among market participants as the long-awaited pick up in US fundamentals is still nowhere to be found. As a result, and while the USD saw some buying interest emerging late in the last NA session (it ebbed vs European currencies/kept vs commodities), the market has been losing faith holding USD longs in anticipation of further delays in a Fed liftoff.
NY Empire State Manufacturing Index (May), Industrial Production (Apr), capacity Utilization (Apr) and Reuters/Michigan Consumer Sentiment Index (May) are the main events in the US.
Brian Daingerfield, FX Trading Strategist at RBS, notes: "Industrial production is due in the US and the underlying manufacturing production data should be in focus given the faltering momentum in manufacturing. Weakness in utilities spending that weighed on headline IP in March may have softened again in April. While that may lead to the headline IP index declining outright, our economists look for underlying manufacturing to rise by 0.3% m/m, above the listed Bloomberg consensus."
"While manufacturing may prove to be a positive, consumer confidence is also released for May and could decline slightly, in line with other indicators of confidence that have dipped recently. Rising fuel prices over the past month could have weighed on the consumer outlook in May," Daingerfield adds.
Sean Callow, FX Strategist at Westpac, shares his take on the upcoming slew of US data, observing that
"the NY Fed’s Empire State manufacturing survey is forecast to bounce to 5.0 in May after printing -1.2 in Apr, while market consensus is for a flat reading for Apr industrial production."
"While the national ISM factory survey production index rose to a three month high, four of the five Fed regional factory surveys point to falling activity," Callow notes. With regards to May preliminary University of Michigan consumer sentiment, Callow expects it to tick higher to 96.0 from 95.9.
AUD/USD saw a sharp decline from 0.8090s to test 0.8045 day low before bargain hunting stepped in to buy some cheap Aussie, helping to settle the rate in the 0.8060 vicinity. NZD/USD skid down as well, visiting intraday area of support at 0.7450/55. USD/JPY saw some demand flows off 119.17 NY close, lifting up the rate some 20 odd pips towards 119.40 session highs. The Nikkei 225 caught a bid tone, up 0.43% heading into the close, after tracking gains seen in Wall Street, where the SP500 is a whisker away from new ATHs. Today in Japan, Domestic Corporate Goods Price Index (YoY) came in at -2.1% in April as expected.
Main headlines in Asia
Most economists see Fed rate hike in Sept - WSJ poll
Kiwi falls as Fonterra cuts forecasts
Heading into Europe
There are no events to take not of during the European session, with all the focus now shifted to a new batch of US data, with so far a sense of disappointment among market participants as the long-awaited pick up in US fundamentals is still nowhere to be found. As a result, and while the USD saw some buying interest emerging late in the last NA session (it ebbed vs European currencies/kept vs commodities), the market has been losing faith holding USD longs in anticipation of further delays in a Fed liftoff.
NY Empire State Manufacturing Index (May), Industrial Production (Apr), capacity Utilization (Apr) and Reuters/Michigan Consumer Sentiment Index (May) are the main events in the US.
Brian Daingerfield, FX Trading Strategist at RBS, notes: "Industrial production is due in the US and the underlying manufacturing production data should be in focus given the faltering momentum in manufacturing. Weakness in utilities spending that weighed on headline IP in March may have softened again in April. While that may lead to the headline IP index declining outright, our economists look for underlying manufacturing to rise by 0.3% m/m, above the listed Bloomberg consensus."
"While manufacturing may prove to be a positive, consumer confidence is also released for May and could decline slightly, in line with other indicators of confidence that have dipped recently. Rising fuel prices over the past month could have weighed on the consumer outlook in May," Daingerfield adds.
Sean Callow, FX Strategist at Westpac, shares his take on the upcoming slew of US data, observing that
"the NY Fed’s Empire State manufacturing survey is forecast to bounce to 5.0 in May after printing -1.2 in Apr, while market consensus is for a flat reading for Apr industrial production."
"While the national ISM factory survey production index rose to a three month high, four of the five Fed regional factory surveys point to falling activity," Callow notes. With regards to May preliminary University of Michigan consumer sentiment, Callow expects it to tick higher to 96.0 from 95.9.