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13 Apr 2015
China woes – a major drag in Asia, US budget statement – Next up
FXStreet (Mumbai) - A big miss on Chinese trade data weighed heavily on the OZ currencies with the Australian dollar losing the most in Asia and the NZD closely following-in. On the other hand, USD/JPY emerged the top performer gaining largely on yen underperformance, extending towards 120.50 – psychological barrier.
Key headlines in Asia
Big miss in China's trade figures
World Bank cuts 2015 China GDP forecast by 0.1bp to 7.1%
BoJ minutes: Underlying inflation trend will continue to improve
Japanese machinery orders, corp good prices upbeat
Dominating themes in Asia - centered on JPY, AUD, NZD
Poor Chinese trade balance data reflecting a narrowing surplus – lowest in 13 months, coupled with China’s GDP forecast downgrade by the World Bank was the common underlying factor that drove the Antipodeans and the Japanese currency in the Asian session.
Australia's currency took a big hit and fell back on 0.75 handle as the outlook for the commodity-exporting nation became bleaker with the release of China's March trade data. The Kiwi also slipped to 3-week lows near 0.7450 in tandem with the Australian dollar.
Meanwhile, the USD/JPY pair rose to highs near 120.50 levels following non-event Bank of Japan’s (BOJ) minutes coupled with Japan core machinery orders witnessing a drop of 0.4% m/m in February, adding to January's 1.7% decline in orders.
Heading into Europe - centered on EUR, GBP
There is nothing much to report in the European session as the EUR calendar is dry for EUR,GBP traders except for Italian industrial production data due to be published at 8GMT which may have negligible impact on the majors. Markets expect a 0.5% increase in Italian industrial output in March against a decline of -0.7% reported in January.
Later in the day, a data-light US session also has only US monthly budget statement to report at 6PM GMT and may also be non-driver for the further US dollar moves.
Further insights for EUR traders in the day ahead,
Valeria Bednarik, Chief Analyst – FXStreet notes, “The constant drama in between Greece and the other members of the EU, alongside with the stimulus launched by the ECB did the rest, tearing apart the EUR/USD pair that erased most of its past 3-week gains."
“The pair is technically bearish with the 4 hours chart showing that the 20 SMA extended further below the largest moving averages, and maintains a strong bearish slope well above the current level, whilst the technical indicators are hovering in oversold levels, with no signs the pair may attempt to correct higher.”
For GBP/USD, Karen Jones, chief analyst at Commerzbank said that GBP/USD has sold off aggressively from 1.50, and ha taken out the 1st April low at 1.4741. "Our longer term target is the 1.4291/29 area – this is where the 78.6% Fibonacci retracement of the 2009 uptrend meets the 2010 low."
Meanwhile, looming Greek reforms are likely to remain in spotlight as stated by analysts at TDS Securities, “Greece is scheduled to continue its “technical work” on Monday after the Orthodox Easter long weekend, and the Euro Working Group has reportedly given Greece a deadline of the end of next week to submit a comprehensive proposal of reforms, so that it can be studied and debated ahead of the Euro group meeting on the 24th."
Key headlines in Asia
Big miss in China's trade figures
World Bank cuts 2015 China GDP forecast by 0.1bp to 7.1%
BoJ minutes: Underlying inflation trend will continue to improve
Japanese machinery orders, corp good prices upbeat
Dominating themes in Asia - centered on JPY, AUD, NZD
Poor Chinese trade balance data reflecting a narrowing surplus – lowest in 13 months, coupled with China’s GDP forecast downgrade by the World Bank was the common underlying factor that drove the Antipodeans and the Japanese currency in the Asian session.
Australia's currency took a big hit and fell back on 0.75 handle as the outlook for the commodity-exporting nation became bleaker with the release of China's March trade data. The Kiwi also slipped to 3-week lows near 0.7450 in tandem with the Australian dollar.
Meanwhile, the USD/JPY pair rose to highs near 120.50 levels following non-event Bank of Japan’s (BOJ) minutes coupled with Japan core machinery orders witnessing a drop of 0.4% m/m in February, adding to January's 1.7% decline in orders.
Heading into Europe - centered on EUR, GBP
There is nothing much to report in the European session as the EUR calendar is dry for EUR,GBP traders except for Italian industrial production data due to be published at 8GMT which may have negligible impact on the majors. Markets expect a 0.5% increase in Italian industrial output in March against a decline of -0.7% reported in January.
Later in the day, a data-light US session also has only US monthly budget statement to report at 6PM GMT and may also be non-driver for the further US dollar moves.
Further insights for EUR traders in the day ahead,
Valeria Bednarik, Chief Analyst – FXStreet notes, “The constant drama in between Greece and the other members of the EU, alongside with the stimulus launched by the ECB did the rest, tearing apart the EUR/USD pair that erased most of its past 3-week gains."
“The pair is technically bearish with the 4 hours chart showing that the 20 SMA extended further below the largest moving averages, and maintains a strong bearish slope well above the current level, whilst the technical indicators are hovering in oversold levels, with no signs the pair may attempt to correct higher.”
For GBP/USD, Karen Jones, chief analyst at Commerzbank said that GBP/USD has sold off aggressively from 1.50, and ha taken out the 1st April low at 1.4741. "Our longer term target is the 1.4291/29 area – this is where the 78.6% Fibonacci retracement of the 2009 uptrend meets the 2010 low."
Meanwhile, looming Greek reforms are likely to remain in spotlight as stated by analysts at TDS Securities, “Greece is scheduled to continue its “technical work” on Monday after the Orthodox Easter long weekend, and the Euro Working Group has reportedly given Greece a deadline of the end of next week to submit a comprehensive proposal of reforms, so that it can be studied and debated ahead of the Euro group meeting on the 24th."