GLOBAL DATA FLOWS IN THE HEADLINES ON TUESDAY
The economic calendar ramps up once again on Tuesday, with headline reports from both sides of the Atlantic Ocean. The facts and figures released over the coming hours could have a direct impact on key currency pairs, including the EUR/USD, GBP/USD and USD/JPY.
The European session kicks off with headline German GDP data. Europe’s largest economy is forecast to grow 0.4% in January-March down from 0.6% the previous quarter. This likely translates into a year-over-year growth rate of 1.7%.
France is scheduled to release multiple data sets at 06:45 GMT, including the monthly consumer price index and Q1 nonfarm payrolls. Consumer inflation is projected to rise 0.1% month-on-month. Meanwhile, first-quarter nonfarm payrolls are projected to rise 0.4%.
In the UK, the Office for National Statistics will release the latest employment figures for April. Britain’s claimant count change is expected to rise by 7,500, signaling higher unemployment. However, the jobless rate is forecast to hold steady at 4.2% in the three months through March. Average hourly earnings including bonuses likely rose 2.6% annually in the first quarter.
ZEW will produce its monthly indicator of German investor sentiment at 09:00 GMT. At the same time, the European Commission’s statistical agency will report on first quarter GDP for the 19-member currency zone. The Eurozone economy likely rose 0.4% in the January-March period.
Shifting gears to North America, the US Department of Commerce will report on retail sales at 12:30 GMT. Receipts at retail stores, long viewed as an important proxy for consumer spending, are forecast to rise 0.3% for April.
Meanwhile, the Federal Reserve Bank of New York will produce the Empire State manufacturing survey at 12:30 GMT. The headline indicator is forecast to show slight weakness during May.
In terms of monetary policy, Federal Open Market Committee (FOMC) members Robert Kaplan and John Williams are scheduled to deliver speeches.
Europe’s common currency was upended on Monday, as prices failed to break above the 1.2000 US barrier. At the time of writing, EUR/USD was trading around 1.1940, where it continues to face resistance at the psychological level.
Cable prices also broke down on Tuesday as the US dollar strengthened against a basket of world currencies. The GBP/USD exchange rate fell from a high near 1.3605 all the way back down to 1.3565. The pair faces immediate resistance at 1.3600, followed by the 1.3715 area.
The greenback rebounded against the yen at the start of the week as the DXY dollar index rose to fresh yearly highs. USD/JPY is now trading around 109.72, where it is coming up against firm resistance near 109.80 and 110.00. On the opposite side of the ledger, immediate support is located near the session low of 109.40.