Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
00:30 | Japan | Nikkei Services PMI | April | 52.0 | |
02:00 | New Zealand | RBNZ Interest Rate Decision | 1.75% | 1.50% | |
02:00 | New Zealand | RBNZ Rate Statement | |||
03:00 | New Zealand | RBNZ Press Conference | |||
03:00 | China | Trade Balance, bln | April | 32.67 | 35 |
05:45 | Switzerland | Unemployment Rate (non s.a.) | April | 2.5% | 2.3% |
06:00 | Germany | Industrial Production s.a. (MoM) | March | 0.7% | -0.5% |
07:30 | United Kingdom | Halifax house price index 3m Y/Y | April | 2.6% | 4.5% |
07:30 | United Kingdom | Halifax house price index | April | -1.6% | 0.1% |
08:15 | United Kingdom | MPC Member Ramsden Speaks | |||
11:30 | Eurozone | ECB President Mario Draghi Speaks | |||
12:15 | Canada | Housing Starts | April | 192.5 | 196.4 |
12:30 | U.S. | FOMC Member Brainard Speaks | |||
14:30 | U.S. | Crude Oil Inventories | May | 9.934 | 0.744 |
Time | Country | Event | Period | Previous value | Forecast |
---|---|---|---|---|---|
00:30 | Japan | Nikkei Services PMI | April | 52.0 | |
02:00 | New Zealand | RBNZ Interest Rate Decision | 1.75% | 1.50% | |
02:00 | New Zealand | RBNZ Rate Statement | |||
03:00 | New Zealand | RBNZ Press Conference | |||
03:00 | China | Trade Balance, bln | April | 32.67 | 35 |
05:45 | Switzerland | Unemployment Rate (non s.a.) | April | 2.5% | 2.3% |
06:00 | Germany | Industrial Production s.a. (MoM) | March | 0.7% | -0.5% |
07:30 | United Kingdom | Halifax house price index 3m Y/Y | April | 2.6% | 4.5% |
07:30 | United Kingdom | Halifax house price index | April | -1.6% | 0.1% |
08:15 | United Kingdom | MPC Member Ramsden Speaks | |||
11:30 | Eurozone | ECB President Mario Draghi Speaks | |||
12:15 | Canada | Housing Starts | April | 192.5 | 196.4 |
12:30 | U.S. | FOMC Member Brainard Speaks | |||
14:30 | U.S. | Crude Oil Inventories | May | 9.934 | 0.744 |
The
Ivey Business School Purchasing Managers Index (PMI), measuring Canada’s
economic activity, rose to 55.9 in April from an unrevised 54.3 in March. That
was the highest reading since December 2018.
Economists
had expected the gauge to hit 53.0.
The figure above 50 shows an increase while below 50 shows a decrease.
Within
sub-indexes, the prices index edged up to 58.9 last month from 58.7 in March
and the supplier deliveries gauge surged to 48.7 from 46.2. At the same time,
the employment measure decreased to 53.7 in April from 54.5 in the prior month and
the inventories indicator dropped to 46.4 from 47.8.
The Job Openings and Labor Turnover Survey (JOLTS) published by the Labor Department on Tuesday showed an increase in the U.S. job openings in February.
According to the report, employers posted 7.488 million job openings in March, compared to the February figure of 7.142 million (revised from 7.087 million in the original estimate) and economists’ expectations of 7.240 million. The job openings rate was 4.7 percent in March, up from 4.5 percent in the prior month. The report showed that the number of job openings increased for total private (+363,000) and was little changed for government. Job openings increased in a number of industries, with the largest increases in transportation, warehousing, and utilities (+87,000), construction (+73,000), and real estate and rental and leasing (+57,000). Job openings declined in federal government (-15,000).
Meanwhile, the number of hires edged down to 5.660 million in March from 5.695 in February. The hiring rate was 3.8 percent, the same as in February. The hires level was little changed for total private and for government. The number of hires was also little changed in all industries and in all four regions.
The separation rate in March was at 5.434 million or 3.6 percent, compared to 5.576 million or 3.7 percent in February. Within separations, the quits rate was 2.3 percent (flat m-o-m), and the layoffs rate was 1.1 percent (-0.1 pp m-o-m).
Richard Franulovich, the head of FX strategy at Westpac, notes the last week’s U.S. data generally ran counter to bond market expectations for Fed insurance cuts as a robust +263k jobs in April confirms that there is still plenty of sizzle to the U.S. economy.
Brexit won’t be solved by the end of October and the European Union (EU) will need to grant yet another deadline, according to the CNBC's survey of the senior financial executives from some of the largest public and private companies in the world, collectively managing nearly $5 trillion in market value.
After missing an end of March exit date, Britain and Northern Ireland are now set to leave the EU on October 31, but the withdrawal agreement has not yet been approved by the UK MPs in London.
Representatives from the ruling Conservative Party and Britain's main opposition Labour Party are currently in talks to see if a cross-party deal can break a deadlock which has brought the process to a halt. However, within both parties, there are deep divides over any joint plan, with a growing chorus calling for a second “confirmatory” referendum on any deal.
According to the latest survey, published Tuesday, 35.6% of chief financial officers (CFOs) now see yet another extension to the Brexit deadline as the most probable option. Exactly 20% percent of respondents think Britain will hold another referendum while 26.7% think the country will leave on the October date with a deal in place.
Just 2.2% of those asked believe that Brexit will happen at the end of October with no deal whatsoever. That marks an enormous shift in sentiment from February this year, when 40.7% of CFOs thought “no-deal” was the most probable option.
Analysts at Rabobank note pressure is reportedly increasing on UK PM May to set a resignation date.
The South China Morning Post (SCMP) reports the Chinese Vice-Premier Liu He will go to the United States on Thursday to continue trade negotiations, the Ministry of Commerce said on Tuesday.
However, the trip, scheduled for two days, is shorter than expected.
China's foreign exchange reserves unexpectedly fell for the first time in six months in April, despite recent data that suggested the world's second-largest economy is starting to steady in response to stimulus measures.
Reserves edged down $3.81 billion last month to $3.095 trillion, the People's Bank of China said. Economists had forecast the world's largest pile of reserves would rise $1.24 billion to $3.1 trillion.
The small drop in April was due to a firmer U.S. dollar and changes in prices of global assets that China holds, the foreign exchange regulator said. In April, the yuan dropped 0.24% against the U. S. dollar as the latter rose nearly 0.3% against a basket of currencies, according to Wind.
Cross-border capital flows will be basically stable in future, the State Administration of Foreign Exchange said. China's foreign exchange reserves climbed by $22.24 billion in the first four months of this year, after dropping $67.24 billion in 2018.
The firm's currency strategist, Lee Hardman, says that there is little optimism among market participants on the prospect of a cross-party Brexit deal arguing that the pound could rally as much as 1-2% if an agreement is reached.
Adding that the currency could strengthen by a further 2-4% if a compromise deal is reached and it is passed through parliament. However, Hardman notes that the firm is currently neutral on the pound as the market has already priced in a softer Brexit. He says that "to build on gains from earlier this year, the pound would need to see a decisive breakthrough in Brexit talks".
International Monetary Fund (IMF) head Christine Lagarde said on Tuesday that China and the United States must resolve their trade tensions because they threaten the global economy.
"For us at the IMF, it's imperative that trade tensions are resolved in a way satisfying for everyone because clearly tensions between the United States and China are the threat to the global economy," said Lagarde, on the sidelines of a conference at France's finance ministry.
Mikael Olai Milhøj, senior analyst at Danske Bank, notes that the global markets shrugged off the new trade-related uncertainty in the previous US session.
“The initial volatility spike and risk-off spot moves across vix, S&P500, yen, yen vol and many other market indicators was seemingly seen as a buy-the-dip, reversing some of the initial reaction. We have highlighted the increased uncertainty from these new developments and hence view yesterday’s reversal in pricing as rather complacent. Though markets might be trying to call the bluff of Trump, we are less certain. As such, we expect elevated volatility in USD/JPY and related China-linked currencies. Tracking if China sends delegates to the US and if Trump really implements these new tariffs on Friday are so far the two main drivers of risk to watch.”
Bill Evans, analyst at Westpac, points out that the Westpac correctly forecast that the RBA would remain on hold at the May Board meeting.
“The Bank was clearly less concerned about the March quarter Inflation report and emphasised the importance of developments in the labour market. Westpac continues to expect rate cuts at the August and November Board meetings. The Reserve Bank Board decided to leave the cash rate unchanged at 1.50%. There are two main reasons behind this decision. Firstly, the RBA’s response to the recent March quarter inflation report was not as negative as had been expected. The second issue of importance was the Board’s noting in the April meeting minutes that “members also discussed the scenario where inflation did not move any higher and unemployment trended up, noting that a decrease in the cash rate would likely be appropriate in these circumstances. We expect that this sequence of weak inflation and softening labour market data will persist throughout 2019, which is consistent with our growth forecast of 2.2% compared to trend of 2 ¾ per cent. That profile remains consistent with the need for further stimulus at the November meeting following the August cut.”
Monthly report on Italian economy from Istat:
According to recent data the international economy is still showing signs of weakness diffused to an increasing number of countries. Risks remain tilted to the downside.
In Italy, in the first quarter of 2019 the seasonally and calendar adjusted, chained volume measure of GDP increased by 0.2% with respect to the previous quarter, interrupting the marginally negative trend of the second half of 2018.
In March, the labor market conditions improved. Employment rate increased while unemployment decreased, although remaining above the euro area average.
Inflation increased marginally with a lower intensity than in the euro area as a whole. Also in terms of core inflation, the gap widened.
In April, the consumer confidence decreased for the third time in a row. The worsening was broad-based to all the components.
According to figures released today by the Society of Motor Manufacturers and Traders (SMMT), the UK new car market declined by -4.1% in April. The month saw 161,064 units registered, the second lowest April volume since 2012 but following a double-digit increase the previous year.1
Registrations by private motorists fell last month, down -10.3%, after a rise of more than 26% in April 2018.2 Fleet demand, meanwhile, remained stable, growing 2.9%, with these businesses registering 2,498 more cars than in April 2018.
Declines were recorded across most vehicle segments, with registrations of popular supermini and small family cars falling most significantly, down -14.1% and -10.6%. Demand for lower volume luxury saloons and sports cars rose while the dual purpose segment also grew, by +18.4% to 40,580 units. Diesel registrations fell again, but the pace of decline slowed significantly, down -9.4%. Petrol demand also dropped, by -3.0%. Overall, alternatively fuelled vehicle (AFV) registrations grew by 12.7%, with 10,254 leaving showrooms. Petrol electric hybrids remained the most popular choice, up 31.1% to 6,810 units. Battery electric cars also recorded a strong uplift, from 929 to 1,517 units, which still only represents 0.9% of the market. Meanwhile, zero emission-capable plug-in hybrids experienced a significant decline, down -34.4% in April and -20.4% year-to-date – evidence of the consequences of prematurely removing upfront purchase incentives before the market is ready.
A Brexit breakthrough in talks between Prime Minister Theresa May’s government and the opposition Labour Party is possible but unlikely this week, the BBC’s political editor cited an unidentified senior government source as saying.
“Senior govt source says it IS possible though to see a way to a deal, but unlikely to be resolved this week,” the BBC’s Laura Kuenssberg said on Twitter.
The aim is “to set out a path to get the Withdrawal Bill to Commons with a fair wind,” she said.
Ahead of his conference at the French finance ministry, the country’s Finance Minister Bruno Le Maire called on the US and China to avoid escalating the trade tensions.
“We want the negotiations to stick to the principals of transparency and multilateralism. I really urge everybody to avoid decisions that would threaten and jeopardize world growth in the coming months.” said Le Maire.
According to the report from IHS Markit, eurozone constructors saw a modest rise in activity during April, extending the current sequence of expansion to two-and-a-half years. The rate of growth was roughly in line with that recorded in March, as faster increases in both housing and commercial activity offset a contraction in civil engineering. Meanwhile, new order growth eased to its softest since a decline last August, and firms reported a slower rate of workforce expansion. Costs continued to rise sharply, but the pace of inflation decelerated to its softest for a year.
Falling fractionally from 52.2 in March to 52.1 in April, the IHS Markit Eurozone Construction PMI signalled a moderate rise in total construction activity, with the rate of growth broadly consistent with that in March. Across the euro area's three largest economies, the quickest expansion was seen in Germany, followed by Italy and France respectively.
U.S.-China trade talks hit a snag when President Donald Trump on Sunday threatened to raise tariffs on Chinese goods - just as an agreement had been said to be “possible” by this Friday.
However, according to the vice president of a Beijing-based think tank, there is still room for China to “maneuver around the headwinds created by the U.S. trade war” - including if the Trump institutes his threatened tariff increase.
“The trade war really has a negative impact on the Chinese economy - there is no denying of that,” Victor Gao of the Center for China and Globalization told.
“However, how much that impact is and whether China as a whole can come up with ways to overcome the impact, that’s another thing,” he added. “China is still enjoying 6% to 6.5% GDP growth, which is more than double the GDP growth of the United States.”
Still, Gao said, it will be in Beijing’s - and Washington’s - favor to strike a deal sooner rather than later.
The think tanker said both governments should “really calm down,” and he warned that bluffing was unlikely to reap dividends in the ongoing negotiations.
Germany hopes that an escalation of the trade dispute between the United States and China can be avoided, Economy Minister Peter Altmaier said on Monday, adding that all parties should be careful with implementing unilateral decisions.
U.S. President Donald Trump has threatened to ratchet up tariffs on $200 billion worth of imports from China, escalating the dispute marked by tit-for-tat duties between Washington and Beijing.
"We all hope that the trade conflict between the U.S. and China can be resolved because it doesn't have any positive consequences for anyone," Altmaier said.
"We need a rules-based trade order, we need open markets, we need fairness and a level playing field i.e. equal rights for companies from all countries involved," Altmaier added.
According to the report from Ministry for the Economy and Finance, in March, the deficit increased by 1.2 billion euros to reach 5.3 billion euros after 4.1 billion euros in February, against a backdrop of higher import trade . Thus, the strong growth of imports (+ 1.7 billion) far exceeds that of exports (+0.5 billion). The surge in supplies of natural hydrocarbons, crude oil but also natural gas, is contributing to the rise in imports. On the export side, the sharp rebound in aeronautical deliveries, after February's dip, was mitigated by the backlash in the exceptional shipments and shipments in February.
In March, the trade balance worsened considerably with non-EU Europe as a result of the sharp decline in exports, reflecting the very high shipments and shipments to Switzerland in February, and the sharp increase in energy supplies. from Russia. The deficit with Asia increased for the fourth month in a row, due to lower exports, notably aeronautical shipments to China and basic chemicals to South Korea. With Africa, the balance deteriorates after the improvement in February, the increase in imports, particularly energy, being higher than that of exports. With America, the balance is also deteriorating because of a stronger dynamism of imports while with the European Union, the deficit is almost stable after two months of aggravation. Conversely, the balance with the Near and Middle East appreciates appreciably in March thanks to an increase in aeronautical deliveries.
Karen Jones, analyst at Commerzbank, points out that the EUR/USD pair is currently recovering in its range but remains capped by 55 day ma at 1.1270.
“For now, we are unable to rule out a retest of the 1.1110 support, but, if seen, we look for this to hold. Be advised that the pattern being traced out is a potential large reversal pattern, we have divergence of the weekly RSI and a 13 count on the weekly chart as well and there is a risk of reversal. Initial resistance is the 100 day ma at 1.1326 and the resistance line at 1.1350 ahead of the 200 day ma at 1.1408. Only above the 200 day ma would this imply reversal. Support at 1.1110 is regarded as the break down point to 2018-2019 support line (connects the lows) at 1.1052, the 1.0963 TD support and the 1.0814/78.6% retracement.”
Based on provisional data, the Federal Statistical Office (Destatis) reports that price-adjusted new orders in manufacturing had increased in March 2019 a seasonally and calendar adjusted 0.6% on the previous month. Economists had expected a 1.5% increase.
For February 2019, revision of the preliminary outcome resulted in a decrease of 4.0% compared with January 2019 (provisional: -4.2%). Price-adjusted new orders without major orders in manufacturing had decreased in March 2019 a seasonally and calendar adjusted 1.9% on the previous month.
Domestic orders decreased by 4.2% and foreign orders rose by 4.2% in March 2019 on the previous month. New orders from the euro area were up 8.6%, new orders from other countries increased 1.4% compared to February 2019.
In March 2019 the manufacturers of intermediate goods saw new orders fall by 1.5% compared with February 2019. The manufacturers of capital goods showed increases of 1.1% on the previous month. For consumer goods, an increase in new orders of 6.4% was recorded.
EUR/USD
Resistance levels (open interest**, contracts)
$1.1345 (4484)
$1.1317 (2387)
$1.1279 (234)
Price at time of writing this review: $1.1212
Support levels (open interest**, contracts):
$1.1148 (8070)
$1.1115 (5141)
$1.1076 (4541)
Comments:
- Overall open interest on the CALL options and PUT options with the expiration date June, 7 is 108774 contracts (according to data from May, 6) with the maximum number of contracts with strike price $1,1200 (8070);
GBP/USD
Resistance levels (open interest**, contracts)
$1.3281 (2007)
$1.3226 (1875)
$1.3187 (809)
Price at time of writing this review: $1.3122
Support levels (open interest**, contracts):
$1.3026 (412)
$1.3002 (1842)
$1.2973 (1764)
Comments:
- Overall open interest on the CALL options with the expiration date June, 7 is 36870 contracts, with the maximum number of contracts with strike price $1,3450 (3078);
- Overall open interest on the PUT options with the expiration date June, 7 is 35388 contracts, with the maximum number of contracts with strike price $1,2800 (3303);
- The ratio of PUT/CALL was 0.96 versus 0.98 from the previous trading day according to data from May, 6
* - The Chicago Mercantile Exchange bulletin (CME) is used for the calculation.
** - Open interest takes into account the total number of option contracts that are open at the moment.
Pare | Closed | Change, % |
---|---|---|
AUDUSD | 0.69882 | -0.35 |
EURJPY | 123.903 | -0.31 |
EURUSD | 1.11937 | -0.02 |
GBPJPY | 144.907 | -0.88 |
GBPUSD | 1.30921 | -0.59 |
NZDUSD | 0.66016 | -0.52 |
USDCAD | 1.34543 | 0.26 |
USDCHF | 1.01753 | 0.11 |
USDJPY | 110.68 | -0.27 |
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