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US consumer confidence dropped to 124.1, point to moderation in economic growth

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    ActionForex.com
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    Conference Board US Consumer Confidence Index dropped to 124.1 in March, down from 131.4 and missed expectation of 132.0. Present Situation Index dropped from 172.8 to 160.6. Expectations Index dropped to 103.8 to 99.8.

    “Consumer Confidence decreased in March after rebounding in February, with the Present Situation the main driver of this month’s decline,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.

    “Confidence has been somewhat volatile over the past few months, as consumers have had to weather volatility in the financial markets, a partial government shutdown and a very weak February jobs report. Despite these dynamics, consumers remain confident that the economy will continue expanding in the near term. However, the overall trend in confidence has been softening since last summer, pointing to a moderation in economic growth.”

    Full release here.

    AUD/CAD turns into consolidation ahead of 0.9870 projection target

      By
      ActionForex.com
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      AUD/CAD trades mildly softer today, partly because the Canadian Dollar is lifted by oil prices. More importantly, buying lost momentum, as seen in 4 hour MACD, just ahead of 38.2% projection of 0.8066 to 0.9696 from 0.9247 at 0.9870. A short term top is possibly in place at 0.9857.

      Some consolidations would likely follow first. Considering that USD/CAD is on the verge of breaking through 1.2688 low, there is prospect of a deeper pull back in AUD/CAD too. Though, downside should be contained by 0.9617 resistance turned support to bring rally resumption. Break of 0.9870 will target 61.8% projection at 1.0254.

      GBP/JPY resumes rally after drawing support from 4 hour 55 EMA

        By
        ActionForex.com
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        GBP/JPY rises after BoE Governor Andrew Bailey said there are a lot of issues with negative interest rates. Solid support was seen in 4 hour 55 EMA, indicating near term bullishness. Further rise is now expected as long as 140.31 support holds. Choppy rise from 133.03 has resumed for a test on 142.71 high. At this point, upside momentum doesn’t warrant a firm break there yet. Thus, we’ll be cautious on topping signals as it approaches 142.71.

        ECB Centeno: The economy surprises quarter after quarter

          By
          ActionForex.com
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          ECB Governing Council member Mario Centeno said, at a panel at the World Economic Forum, the a recession is not a foregone conclusion.

          The Eurozone economy “has been surprising us quarter after quarter,” he said. “The fourth quarter in Europe will be most likely still positive. Maybe we’ll be surprised also in the first half of the year.”

          Meanwhile, Centeno pledged that ECB will continue to fight inflation.

          ECB Knot: Decision next week would imply a reduction in PEPP purchase pace

            By
            ActionForex.com
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            ECB Governing Council member Klass Knot said he’d expects a decision in next week’s meeting that “should not be incompatible” with ending the PEPP in March. And, “that would imply a reduction in the purchase pace.”

            Knot explained that “PEPP has a clearly delineated objective — repairing the damage that the coronavirus has inflicted on the inflation outlook.” And, “the stars are much better aligned than they have been for a long time for the return of inflation back to 2%.”

            Though, he added, “I can understand that next week we may want to maintain some optionality, also to see how the delta variant will play out.”

            Asian update: Sterling found footing after selloff, Aussie rises on CPI

              By
              ActionForex.com
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              Sterling suffered broad based selloff overnight as the UK parliament put Brexit back into uncertainty. But losses are so far limited as the Pound quickly stabilized. In short, the Parliament passed the proposal to ask Prime Minister Theresa May to go back to Brussels to renegotiate the Irish backstop into alternative arrangements. But EU has reinstated the stance that it won’t reopen negotiations.

              In the currency markets, Australian Dollar is the strongest one in Asian markets today, after slightly stronger than expected Q4 CPI reading. New Zealand Dollar follows as the second. Swiss Franc is currently the weakest one , followed by Dollar and then Yen. The economic calendar is rather busy today. French GDP, Swiss KOF, Eurozone confidence indicators, Germany CPI and US ADP employment will also be watched. But the major focus will be on FOMC rate decision and press conference.

              In Asia:

              • Nikkei is currently down -0.26%.
              • Hong Kong HSI is up 0.29%.
              • China Shanghai SSE is up 0.09%.
              • Singapore Strait Times is down -0.11%.
              • Japan 10-year JGB yield is up 0.0003 at 0.004.

              Overnight:

              • DOW rose 0.21%.
              • S&P 500 dropped -0.15%.
              • NASDAQ dropped -0.81%.
              • 10-year yield dropped -0.032 to 2.712.

              Asian update: Dollar strongest as RBA and China shrugged. Stocks mixed

                By
                ActionForex.com
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                Following the decline in US stocks, Asian markets turned slightly weaker today. Chinese stocks are resilient though, fluctuating in tight range between gain and loss. The government lowered 2019 growth target to 6.0-6.5%, with the lower bound at lowest pace in more than three decades. But the move was widely expected and thus triggered little reactions. RBA kept interest rate unchanged at 1.50% too. It maintained the central scenarios of growth, inflation and employment forecasts. The tone of the statement is a touch more optimistic comparing to February’s. But it’s largely shrugged off by the Australian Dollar.

                In the currency markets, Dollar is so far the strongest one for today, followed by Euro and Swiss Franc.  EUR/USD breached 1.1316 support overnight but there was no follow through buying. The greenback will need to flex some more muscles to show that it’s regaining near term strength. Commodity currencies are the weakest ones, led by New Zealand Dollar.

                In Asia:

                • Nikkei is down -0.60%.
                • Hong Kong HSI is down -0.10%.
                • China Shanghai SSE is up 0.15%.
                • Singapore Strait Times is down -0.46%.
                • Japan 10-year JGB yield is up 0.0023 at 0.003, staying positive.

                Overnight:

                • DOW dropped -0.79%.
                • S&P 500 dropped -0.39%.
                • NASDAQ dropped -0.23%.
                • 10-year yield dropped -0.033 to 2.722.

                There is some improvements in yield curve inversion in the US. 5-year yield at 2.531 is now back above 6-month yield at 2.504. Ad it’s not far from 1-year yield at 2.557.

                European Commission Vice Sefcovic: Retaliation duties on US goods will start in July

                  By
                  ActionForex.com
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                  European Commission Vice President for energy Maros Sefcovic said the commission expects to conclude the “relevant coordination” with member stats regarding the retaliation tariffs to the US in June. The new duties on US imports to EU would start applying in July.

                  Sefcovic declared earlier this week to make the bid to succeed Jean-Claude Juncker as President in late 2019.

                  CAD/JPY’s recovery might have completed at 81.18

                    By
                    ActionForex.com
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                    CAD/JPY’s mild decline this week, with 4 hour MACD crossed below signal line, argues that corrective recovery from 80.12 might have completed at 81.18 already. Focus will be on 80.12 support for the next few days. Break there will resume whole fall from 82.10 to 79.22 support first. Also, such development, if happens, will bring CAD/JPY firmly back below 55 day EMA. That could prompt deeper selling back to the bottom of prior range at 77.91. Nevertheless, above 81.18 would extend the recovery to retest 82.10 high instead.

                    Germany PMIs improve, but points to economic contraction in current quarter

                      By
                      ActionForex.com
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                      While Germany witnessed a modest improvement in its economic indicators for September, underlying concerns persist. PMI Manufacturing saw a slight climb from 39.1 to 39.8. Similarly, PMI Services edged up from 47.3 to just below the 50 mark at 49.8. Composite PMI experienced an uptick, moving from 44.6 to 46.2.

                      Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank, addressed the improvements, particularly noting, “The German services PMI stopped its slump and nudged up near 50 in September.” Nonetheless, despite this upward nudge, the service sector remains virtually unchanged following the dip seen in August.

                      Encouragingly, recent PMI data suggests a deceleration in the decline of new orders and a slowdown in the reduction of purchasing activity in manufacturing. However, a closer look into the data indicates that manufacturing production might experience a drop surpassing 2 percent compared to the preceding quarter.

                      The broader picture is not particularly optimistic. “Germany has entered once again into contraction during the current quarter.” Hamburg Commercial Bank’s latest projections anticipate a sharp GDP decline of 1 percent relative to the prior quarter.

                      Full Germany PMI release here.

                      US consumer confidence rose to 137.9, consumers expect strong growth to carry over into early 2019

                        By
                        ActionForex.com
                        -

                        US Consumer Confidence rose to 137.9 in October, up from revised 135.3, beat expectation of 135.0. That’s also the higest level in 18 years since September 2000. Present Situation Index improved from 169.4 to 172.8. Expectations Index rose from 112.5 to 114.6.

                        Conference Board noted in the release that “Consumers’ assessment of present-day conditions remains quite positive, primarily due to strong employment growth. The Expectations Index posted another gain in October, suggesting that consumers do not foresee the economy losing steam anytime soon. Rather, they expect the strong pace of growth to carry over into early 2019.”

                        Full release here.

                        US stocks appear to be lifted by the stronger than expected release. DOW initially hesitated today but it’s now up 1%.

                        NZ BNZ services rose to 55.8, activity growing relatively well

                          By
                          ActionForex.com
                          -

                          New Zealand BusinessNZ Performance of Services Index rose from 54.7 to 55.8 in February. The move further above the trend in the index indicates a more favorable comparison to its long-term average of 53.6.

                          Looking at some details, activity/sales rose from 52.1 to 53.6, while employment dipped from 51.6 to 51.2. New orders/business increased from 54.8 to 57.1, and stocks/inventories went up from 54.7 to 58.3. Additionally, supplier deliveries improved from 52.3 to 55.9.

                          BNZ Senior Economist Craig Ebert said that “the strongly expanding PSI, along with the recovered tone of the PMI, suggests economic activity is growing relatively well in the early stages of this year”.

                          Full release here.

                          UK payrolled employment rose 33k in Oct, unemployment rate unchanged at 4.2% in Sep

                            By
                            ActionForex.com
                            -

                            UK payrolled employment rose 33k, or 0.1% mom in October. Over the year, payrolled employment rate 398k or 1.3% yoy. Median monthly pay rose 5.9% yoy, down from prior month’s 6.0% yoy. Claimant count rose 17.8k, above expectation of 15.0k.

                            In the three months to September, unemployment rate was unchanged at 4.2%, matched expectations. Average earnings including bonus rose 7.9% yoy, above expectation of 7.4%, slowed from prior 8.2%. Average earnings excluding bonus rose 7.7% yoy, matched expectations, slowed from prior month’s 7.8%.

                            Full UK employment release here.

                            New Zealand BNZ services dropped to 51.4, disappointing in context of easing restrictions

                              By
                              ActionForex.com
                              -

                              New Zealand BNZ Performance of Services Index ticked down from 51.5 to 51.4 in April. Looking at some details, activity/sales dropped from 53.5 to 52.7. Employment rose from 49.2 to 51.2. New orders/business dropped from 59.0 to 53.6. Stocks/inventories rose from 52.8 to 54.8. Supplier deliveries dropped from 40.5 to 40.1.

                              BNZ Senior Economist Doug Steel said that “for large parts of the service sector that have been through the ringer over recent times, we suspect any result above breakeven would be welcomed. But, on the other hand, April’s result also looks somewhat disappointing in the context of easing COVID restrictions (from Red to Orange) halfway through the month.”

                              Full release here.

                              UK CPI rose to 9.4% yoy in Jun, goods up 12.7% yoy, services up 5.2% yoy

                                By
                                ActionForex.com
                                -

                                UK CPI accelerated from 9.1% yoy to 9.4% yoy in June, above expectation of 9.3% yoy. That’s also the highest level since the series began in January 1991. Indicative model estimates that it’s the highest since 1982, when it was 11%.

                                The CPI all goods index rose by 12.7% yoy, accelerated from 12.4%. CPI all services rose 5.2% yoy, accelerated from 4.9%. CPI core (excluding energy, food, alcohol, and tobacco) slowed from 5.9% yoy to 5.8% yoy, below expectation of 6.0% yoy.

                                Full CPI release here.

                                Also published from the UK, PPI input was at 1.8% mom, 24.0% yoy, versus expectation of 0.9% mom, 23.5% yoy. CPI output was at 1.4% mom, 16.5% yoy, versus expectation of 2.0% mom, 16.8% yoy. CPI output core was at 0.8% mom, 15.2% yoy, versus expectation of 2.0% mom, 15.5% yoy.

                                NZD/JPY topped in short term after hitting 61.8% projection

                                  By
                                  ActionForex.com
                                  -

                                  NZD/JPY lost upside momentum and retreated after hitting 74.03. That also came after hitting 61.8% projection of 63.45 to 71.66 from 68.86 at 73.93, as well as 73.53 medium term resistance. Considering bearish divergence condition in 4 hour MACD, a short term top was likely in place. Break of 72.79 support will confirm and bring deeper pull back towards 55 day EMA.

                                  That would also come with bearish divergence condition in daily MACD, suggesting that NZD/JPY is in correction to the whole five wave sequence from 59.49. In that case, sustained break of 55 day EMA would bring deeper fall to 68.86 support at least. Nevertheless, break of 74.03 should bring up trend resumption to 100% projection at 77.07 instead.

                                  UK unemployment rate edged higher to 3.9%, wage growth slowed

                                    By
                                    ActionForex.com
                                    -

                                    UK unemployment rate rose to 3.9% in the three month to August, up from 3.8% and above expectation of 3.8%. That figure was slightly lower than 4.0% a year ago. Unemployment rate for men came at 4.0% while unemployment rate for women was at 3.7%. Average weekly earnings (including bonus) growth slowed to 3.8%, down from 3.9% and missed expectation of 3.9%. Average earnings (excluding bonus) growth also slowed to 3.8%, down from 3.9% but beat expectation of 3.7%.

                                    Full release here.

                                    US initial claims dropped to 211k, below expectation of 215k

                                      By
                                      ActionForex.com
                                      -

                                      US initial jobless claims dropped -8k to 211k in the week ending November 2, below expectation of 215k. Four-week moving average of initial claims rose 0.25k to 215.25k.

                                      Continuing claims dropped -3k in the week ending October 26 to 1.689m. Four-week moving average of continuing claims was unchanged at 1.687m.

                                      Full release here.

                                      Fed Daly: Patient until data suggests we go one way or another

                                        By
                                        ActionForex.com
                                        -

                                        San Francisco Federal Reserve President Mary Daly said yesterday that “patience is where I’m at right now,” regarding monetary policy. She added the US economy is in “a good place”. And interest rates should be left unchanged “until the data suggests we go one way or another way.”

                                        Though, she predicts that unemployment rate at 3.8% will eventually push wages and prices upward. And “it’s just taking a longer time than it typically does”. She noted “that’s part of what feeds into my patient strategy.”

                                        Daly supported Decembers rate hike when the economy was growing at a faster rate. Now, she noted interest rates are at “neutral” and thus, patience is “the way to go, because you don’t want to guess that you need to do more, or guess that we need to do less, you just want to be patient and look at the data.”

                                        Japan tankan large manufacturing rose to -10, non-manufacturing rose to -5

                                          By
                                          ActionForex.com
                                          -

                                          Japan Tankan large manufacturing index rose 17 points from -27 to -10 in Q4, above expectation of -15. Outlook also improvement to -8, up from -17, and beat expectation of -11. Non-manufacturing index rose 7 pts from -12 to -5, slightly above expectation of -6. Non-manufacturing outlook rose from -11 to -6, above expectation of -7. However, all industry capex dropped -1.2%, much worse than expectation of -0.1%.

                                          The set of data would affirm BoJ’s decision to stand pat on interest rate and QE program later in the week. Though, extensions of the emergence lending programs would be extended, as Japan is currently in a “relatively” serious third wave of coronavirus infections.

                                          Full release here.

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