Forex News Timeline
08:20 NZD/USD remains firmer around 0.5950 due to improved risk appetite
The NZD/USD pair showed positive movement, trading around 0.5960 during the Asian session on Friday.
NZD/USD remains steady due to risk appetite improvements for risk-sensitive currencies.The gains of the US Dollar could be limited due to the lower US Treasury yields.New Zealand’s ANZ-Roy Morgan Consumer Confidence decreased to 82.1 in April, reaching its lowest level since 2008.The NZD/USD pair showed positive movement, trading around 0.5960 during the Asian session on Friday. The New Zealand Dollar (NZD), known for its sensitivity to risk sentiment, gained momentum as risk appetite improved, supporting the NZD/USD pair. However, the pair trimmed some of its intraday gains due to a rebound in the US Dollar (USD).The US Dollar Index (DXY), which measures the USD against six major currencies, edges up to near 105.70, although its gains may be limited by a downward correction in US Treasury yields, contributing to the USD's weakness.
On Thursday, mixed preliminary data from the United States (US) put pressure on the Greenback. The US Gross Domestic Product Annualized (Q1) expanded at a slower pace of 1.6% compared to the previous reading of 3.4%, falling short of market expectations of 2.5%. This slowdown suggests potential headwinds or slowdowns in various sectors of the economy.
However, US consumer prices have shown resilience, with the Personal Consumption Expenditures (QoQ) Price Index for Q1 increasing at a 3.7% annual rate. This exceeded both market expectations of 3.4% and the previous reading of 2.0%, indicating prevailing inflationary pressures that could influence Federal Reserve (Fed) monetary policy decisions.
On the Kiwi's side, Friday's ANZ-Roy Morgan Consumer Confidence slipped to 82.1 in April, from the previous reading of 86.4. This has marked its lowest level since 2008. Despite this decline, New Zealand's consumer confidence remains relatively elevated. Additionally, Stats NZ reported a trade surplus in March, driven by exports reaching a 10-month high while imports fell to a 2-month low. The decrease in imports reflects a sluggish economy, as both households and businesses grapple with the impact of high interest rates.
Looking ahead, market attention is now focused on the US Personal Consumption Expenditures (PCE) Price Index data for March, slated for release on Friday. This data is expected to garner significant interest from investors as they assess its implications for inflationary pressures and potential effects on US monetary policy.
NZD/USD Overview Today last price 0.596 Today Daily Change 0.0012 Today Daily Change % 0.20 Today daily open 0.5948
Trends Daily SMA20 0.596 Daily SMA50 0.6049 Daily SMA100 0.6115 Daily SMA200 0.6048
Levels Previous Daily High 0.5969 Previous Daily Low 0.5919 Previous Weekly High 0.5954 Previous Weekly Low 0.5851 Previous Monthly High 0.6218 Previous Monthly Low 0.5956 Daily Fibonacci 38.2% 0.595 Daily Fibonacci 61.8% 0.5938 Daily Pivot Point S1 0.5922 Daily Pivot Point S2 0.5895 Daily Pivot Point S3 0.5871 Daily Pivot Point R1 0.5972 Daily Pivot Point R2 0.5996 Daily Pivot Point R3 0.6023
08:16 EUR/USD trades with negative bias, holds above 1.0700 as traders await US PCE Price Index
The EUR/USD pair edges lower during the Asian session on Friday and moves away from a two-week high, around the 1.0740 area touched the previous day.
EUR/USD meets with some supply amid the emergence of some USD buying on Friday.Bets that the Fed will keep rates higher for longer amid sticky inflation underpin the USD.Traders, however, seem reluctant and look to the US PCE Price Index for a fresh impetus.The EUR/USD pair edges lower during the Asian session on Friday and moves away from a two-week high, around the 1.0740 area touched the previous day. Spot prices currently trade around the 1.0725-1.0720 region and remain at the mercy of the US Dollar (USD) price dynamics ahead of the crucial US data.
The US Personal Consumption Expenditures (PCE) Price Index data is due for release later during the North American session and will be looked upon for cues about the Federal Reserve's (Fed) rate cut path. This, in turn, will play a key role in influencing the near-term USD price dynamics. In the meantime, growing acceptance that the US central bank will keep interest rates higher for longer lends some support to the Greenback and exerts some downward pressure on the EUR/USD pair.
Investors have pushed back their expectations about the timing of the first rate cut by the Fed to September. The bets were reaffirmed by data released on Thursday, which showed that the underlying inflation rose more than expected in the first quarter. This helps offset a deceleration in the economic growth to a 1.6% annualized rate during the January-March quarter – marking the weakest reading since mid-2022 – and keeps the US Treasury bond yields elevated, underpinning the USD.
Apart from this, bets that the European Central Bank (ECB) will start cutting interest rates in June, amid a faster-than-anticipated fall in the Eurozone inflation, suggests that the path of least resistance for the EUR/USD pair is to the downside. That said, it will still be prudent to wait for strong follow-through selling before confirming that the recent recovery from the 1.0600 mark, or the YTD low has run its course traders await the key US inflation data.
EUR/USD Overview Today last price 1.0722 Today Daily Change -0.0008 Today Daily Change % -0.07 Today daily open 1.073
Trends Daily SMA20 1.0732 Daily SMA50 1.0807 Daily SMA100 1.0848 Daily SMA200 1.0808
Levels Previous Daily High 1.0741 Previous Daily Low 1.0678 Previous Weekly High 1.069 Previous Weekly Low 1.0601 Previous Monthly High 1.0981 Previous Monthly Low 1.0768 Daily Fibonacci 38.2% 1.0717 Daily Fibonacci 61.8% 1.0702 Daily Pivot Point S1 1.0692 Daily Pivot Point S2 1.0654 Daily Pivot Point S3 1.063 Daily Pivot Point R1 1.0754 Daily Pivot Point R2 1.0779 Daily Pivot Point R3 1.0816
08:00 Singapore Industrial Production (MoM) below forecasts (-8.8%) in March: Actual (-16%)
Singapore Industrial Production (MoM) below forecasts (-8.8%) in March: Actual (-16%)
08:00 Singapore Industrial Production (YoY) below expectations (-1.5%) in March: Actual (-9.2%)
Singapore Industrial Production (YoY) below expectations (-1.5%) in March: Actual (-9.2%)
07:12 EUR/JPY extends rally above 167.50 following BoJ rate decision
The EUR/JPY cross drifts higher to 167.20, its highest level since 2008, during the Asian trading hours on Friday.
EUR/JPY gains ground near 167.20 amid the weaker JPY on Friday. The BoJ kept interest rates steady around zero on Friday. ECB’s Nagel said he would be in favor of a rate cut in June. The EUR/JPY cross drifts higher to 167.20, its highest level since 2008, during the Asian trading hours on Friday. The uptick of the cross is supported by the weaker Japanese Yen (JPY) after the Bank of Japan (BoJ) announced its policy decision.
The Bank of Japan (BoJ) board members decided to leave the key interest rate unchanged at 0% at its April policy meeting on Friday, as widely expected. The Japanese central bank hiked rates for the first time since 2007 in its March meeting, ending Japan’s negative interest rate era that began in 2016. Furthermore, the BoJ provided new forecasts predicting that inflation would remain close to its 2% target over the next three years, indicating that it is prepared to raise borrowing rates later this year. The central bank added it would continue to purchase government bonds in accordance with guidance decided in March to acquire around 6 trillion yen ($38.45 billion) per month. Following the meeting, the Japanese Yen (JPY) attracts some sellers against the Euro (EUR).
The recent consumer inflation in Tokyo declined sharply in April. The Statistics Bureau of Japan reported on Friday that the headline Tokyo Consumer Price Index (CPI) for April rose 1.8% YoY, compared to the previous reading of a 2.6% rise. Meanwhile, the Tokyo CPI ex Fresh Food, Energy increased 1.8% YoY versus 2.7% expected and the previous reading of 2.9% rise. The softer inflation in Tokyo also weighs on the safe-haven JPY.
On the Euro front, European Central Bank (ECB) policymaker Joachim Nagel said on Wednesday that he would be in favor of a rate cut in June, adding that such a step would not necessarily be followed by a series of rate cuts. The ECB’s Fabio Panetta said small interest rate cuts will stem the risk of prolonged economic stagnation in the euro area. EUR/JPY Overview Today last price 167.21 Today Daily Change 0.19 Today Daily Change % 0.11 Today daily open 167.02 Trends Daily SMA20 164.5 Daily SMA50 163.46 Daily SMA100 161.07 Daily SMA200 159.9 Levels Previous Daily High 167.09 Previous Daily Low 165.93 Previous Weekly High 165.03 Previous Weekly Low 162.67 Previous Monthly High 165.36 Previous Monthly Low 160.22 Daily Fibonacci 38.2% 166.65 Daily Fibonacci 61.8% 166.37 Daily Pivot Point S1 166.27 Daily Pivot Point S2 165.52 Daily Pivot Point S3 165.11 Daily Pivot Point R1 167.43 Daily Pivot Point R2 167.84 Daily Pivot Point R3 168.59
The Bank of Japan (BoJ) board members decided to leave the key interest rate unchanged at 0% at its April policy meeting on Friday, as widely expected. The Japanese central bank hiked rates for the first time since 2007 in its March meeting, ending Japan’s negative interest rate era that began in 2016. Furthermore, the BoJ provided new forecasts predicting that inflation would remain close to its 2% target over the next three years, indicating that it is prepared to raise borrowing rates later this year. The central bank added it would continue to purchase government bonds in accordance with guidance decided in March to acquire around 6 trillion yen ($38.45 billion) per month. Following the meeting, the Japanese Yen (JPY) attracts some sellers against the Euro (EUR).
The recent consumer inflation in Tokyo declined sharply in April. The Statistics Bureau of Japan reported on Friday that the headline Tokyo Consumer Price Index (CPI) for April rose 1.8% YoY, compared to the previous reading of a 2.6% rise. Meanwhile, the Tokyo CPI ex Fresh Food, Energy increased 1.8% YoY versus 2.7% expected and the previous reading of 2.9% rise. The softer inflation in Tokyo also weighs on the safe-haven JPY.
On the Euro front, European Central Bank (ECB) policymaker Joachim Nagel said on Wednesday that he would be in favor of a rate cut in June, adding that such a step would not necessarily be followed by a series of rate cuts. The ECB’s Fabio Panetta said small interest rate cuts will stem the risk of prolonged economic stagnation in the euro area. EUR/JPY Overview Today last price 167.21 Today Daily Change 0.19 Today Daily Change % 0.11 Today daily open 167.02 Trends Daily SMA20 164.5 Daily SMA50 163.46 Daily SMA100 161.07 Daily SMA200 159.9 Levels Previous Daily High 167.09 Previous Daily Low 165.93 Previous Weekly High 165.03 Previous Weekly Low 162.67 Previous Monthly High 165.36 Previous Monthly Low 160.22 Daily Fibonacci 38.2% 166.65 Daily Fibonacci 61.8% 166.37 Daily Pivot Point S1 166.27 Daily Pivot Point S2 165.52 Daily Pivot Point S3 165.11 Daily Pivot Point R1 167.43 Daily Pivot Point R2 167.84 Daily Pivot Point R3 168.59
07:08 Gold price flatlines as traders look to US PCE Price Index for some meaningful impetus
Gold price (XAU/USD) struggles to capitalize on the previous day's modest gains and oscillates in a narrow range during the Asian session on Friday amid mixed fundamental cues.
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Investors seem convinced that the US central bank will keep interest rates higher for longer amid sticky inflation. This remains supportive of elevated US Treasury bond yields and lends support to the Greenback. Apart from this, a positive tone around the equity markets further contributes to keeping a lid on the safe-haven Gold price. Traders also seem reluctant and prefer to wait for the release of the US Personal Consumption Expenditures (PCE) Price Index for cues about the Fed's rate-cut path, which should determine the next leg of a directional move for the XAU/USD.
Daily Digest Market Movers: Gold price traders await more cues about the Fed’s rate-cut path before placing directional bets The US GDP report released on Thursday showed a sharp deceleration in economic growth and stubborn inflation, which, in turn, is seen as a key factor lending support to the Gold price. According to the data published by the US Commerce Department, the world’s largest economy grew by 1.6% at an annualized rate in the first quarter, marking the weakest reading since mid-2022. Additional details of the report revealed that underlying inflation rose more than expected, by 3.7%, in the first quarter, reaffirming bets that the Federal Reserve will keep rates higher for longer. The yield on the benchmark 10-year US government bond shot to the highest level in more than five months in reaction to the mixed data and acts as a headwind for the non-yielding yellow metal. This, along with easing fears about a further escalation of geopolitical tensions in the Middle East, undermines the safe-haven precious metal and should contribute to capping the upside. The US Dollar bulls, meanwhile, prefer to wait for more cues about the Fed’s rate cut path, putting the focus squarely on the release of the Personal Consumption Expenditures (PCE) Price Index. The crucial inflation data will play a key role in influencing the Fed’s future policy decisions and driving the USD demand, which should help in determining the near-term trajectory for the commodity.
Technical Analysis: Gold price consolidates in a range, $2,300 holds the key for bulls and should act as a strong base
From a technical perspective, the XAU/USD, so far, has been struggling to make it through the 100-period Simple Moving Average (SMA) on the daily chart. The said barrier is currently pegged near the $2,345 region and should now act as a key pivotal point amid mixed oscillators on the daily chart. Meanwhile, a sustained strength beyond will be seen as a fresh trigger for bullish traders and lift the Gold price to the next relevant hurdle near the $2,371-2,372 region. The subsequent move up could extend further towards the $2,400 round figure en route to the all-time peak, around the $2,431-2,432 area touched earlier this month.
On the flip side, bearish traders are likely to wait for some follow-through selling and acceptance below the $2,300 mark before placing fresh bets. The Gold price might then extend the corrective decline further towards the $2,260-2,255 intermediate support before eventually dropping to the $2,225 area and the $2,200-2,190 region, representing the 50-day Simple Moving Average (SMA).
Gold FAQs Why do people invest in Gold?
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold?
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets?
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on?
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
06:53 Australian Dollar pares gains amid improved US Dollar, awaits US PCE
The Australian Dollar (AUD) continues its upward trend for the fifth consecutive session on Friday.
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The Australian Dollar strengthened further on the back of rising yields in Australian government bonds, with the 10-year yield hitting a 21-week high of 4.59%. This surge is attributed to the recent release of Australia's Consumer Price Index (CPI) data on Wednesday, which surpassed expectations and triggered a hawkish sentiment surrounding the RBA.The US Dollar Index (DXY), which measures the performance of the US Dollar (USD) against six major currencies, rebounds, potentially influenced by a shift toward risk-off sentiment. However, this gain could be limited due to the downward correction in US Treasury yields, which contributed to the weakening of the Greenback.
Despite mixed preliminary data released from the United States (US) on Thursday, including higher-than-expected Core Personal Consumption Expenditures and lower-than-expected Gross Domestic Product Annualized for the first quarter, the US Dollar remained subdued.
Market attention now turns to the US Personal Consumption Expenditures (PCE) Price Index data for March, scheduled for release on Friday. This data is anticipated to draw significant focus as investors gauge its implications for inflationary pressures and potential impacts on US monetary policy.
Daily Digest Market Movers: Australian Dollar appreciates due to the hawkish RBA In the first quarter, the US Gross Domestic Product Annualized (Q1) expanded at a slower pace, growing by 1.6% compared to the previous reading of 3.4%. This figure fell short of market expectations, which anticipated a growth rate of 2.5%. The deceleration in GDP growth suggests potential headwinds or slowdowns in various sectors of the economy. US consumer prices have demonstrated resilience, with the latest data indicating that the Personal Consumption Expenditures (QoQ) Price Index for Q1 increased at a 3.7% annual rate. This surpassed both market expectations of 3.4% and the previous reading of 2.0%. The persistent upward movement in consumer prices may indicate ongoing inflationary pressures, which could influence monetary policy decisions by the Federal Reserve. The US Initial Jobless Claims for the week ending on April 19 experienced a significant decrease, falling by 5,000 to 207,000. This figure marks the lowest level seen in two months and surpasses both market expectations of 214,000 and the previous reading of 212,000. This unexpected decline in jobless claims indicates a strengthening labor market, suggesting reduced layoffs and potentially increased hiring activity. According to the CME FedWatch Tool, the likelihood of the Federal Reserve's (Fed) interest rates remaining unchanged in the June meeting has risen to 85.2%, up from Wednesday’s 83.5%. Luci Ellis, the chief economist at Westpac and former Assistant Governor (Economic) at the Reserve Bank of Australia, notes that inflation slightly exceeded expectations in the March quarter. Westpac anticipates that the Board will keep interest rates unchanged in May and has adjusted their forecasted date for the first rate cut from September to November this year. In March, the Consumer Price Index (CPI) indicator in Australia rose to 3.5% YoY. While this figure exceeded expectations of 3.4%, it represented the highest level in four months. The uptick was primarily driven by faster increases in housing and transport prices. Excluding volatile items and travel, the monthly Australian CPI indicator climbed to 4.1% in March, up from a 3.9% gain in February. Despite this rise, inflation continues to remain outside the Reserve Bank of Australia's target range of 2-3%, indicating ongoing challenges in achieving the desired level of price stability.
Technical Analysis: Australian Dollar holds position above 0.6500
The Australian Dollar trades around 0.6520 on Friday. The pair has breached into a symmetrical triangle pattern, with the 14-day Relative Strength Index (RSI) above the 50-level, supporting this bullish outlook.The AUD/USD pair could target the pullback resistance at the level of 0.6553. A breakthrough above the latter could lead the pair to approach the psychological level of 0.6600 and aim for the triangle's upper boundary near 0.6639.
On the downside, immediate support is expected around the psychological level of 0.6500. A break below this level may lead to further downside momentum, with the next significant support region around 0.6443, following further support at April’s low of 0.6362.
AUD/USD: Daily ChartAustralian Dollar price this week
The table below shows the percentage change of the Australian Dollar (AUD) against listed major currencies this week. The Australian Dollar was the strongest against the Japanese Yen. USDEURGBPCADAUDJPYNZDCHFUSD -0.59% -0.99% -0.60% -1.47% 0.90% -0.93% 0.24%EUR0.59% -0.40% -0.01% -0.88% 1.48% -0.34% 0.83%GBP0.98% 0.40% 0.39% -0.49% 1.87% 0.05% 1.22%CAD0.60% 0.01% -0.38% -0.86% 1.49% -0.33% 0.84%AUD1.45% 0.88% 0.49% 0.88% 2.33% 0.53% 1.71%JPY-0.91% -1.49% -1.90% -1.51% -2.38% -1.84% -0.66%NZD0.91% 0.35% -0.06% 0.34% -0.54% 1.80% 1.18%CHF-0.24% -0.84% -1.24% -0.84% -1.73% 0.66% -1.18%
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Australian Dollar FAQs What key factors drive the Australian Dollar?
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar?
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar?
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar?
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
06:23 Japan BoJ Interest Rate Decision came in at 0%, below expectations (0.1%)
Japan BoJ Interest Rate Decision came in at 0%, below expectations (0.1%)
06:22 USD/INR halts its rally ahead of US PCE data
Indian Rupee (INR) extends the rally on Friday, bolstered by interbank US Dollar (USD) sales.
.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Indian Rupee trades on a positive note on the weaker USD on Friday. The uptick in INR is bolstered by interbank USD sales and easing Middle East tensions.The final reading of the US March Personal Consumption Expenditures Price Index (PCE) will be the highlight on Friday. Indian Rupee (INR) extends the rally on Friday, bolstered by interbank US Dollar (USD) sales. The softer USD against key rivals overseas and easing geopolitical tensions in the Middle East also supported the local currency. However, the recovery in crude oil prices and foreign capital outflows might weigh on the INR. Additionally, a hawkish repricing of US Federal Reserve (Fed) rate cut expectations amid elevated inflation will continue to boost the USD and cap the pair’s downside.
Market players will keep an eye on the final reading of the US March Personal Consumption Expenditures Price Index (PCE), which might offer some hints about the inflation trajectory in the US and point to the Federal Reserve's (Fed) next move. Apart from this, India’s general election, which started on 19 April and will run until 1 June, will be closely watched. Daily Digest Market Movers: Indian Rupee remains firm amid global challengesThe Indian Rupee was the least volatile major currency among its emerging market peers and a few advanced economies in the financial year 2023–24, according to the Monthly Economic Review report of the Department of Economic Affairs under the Ministry of Finance. The report added that India’s foreign exchange reserves reached an all-time high in March 2024, sufficient to cover 11 months of projected imports and more than 100% of total external debt. The first estimate of US Gross Domestic Product (GDP) grew by 1.6% on an annualized basis in the first quarter (Q1) of 2024, compared to a 3.4% growth in Q4 2023, below the market consensus of 2.5%. The US Personal Consumption Expenditures Prices (PCE) rose at an annualized rate of 3.4% in Q1, nearly double the 1.8% pace recorded in Q4 2023. HSBC analysts expect the Fed to leave its policy rate unchanged in May and said that economic growth and core inflation data in the coming months will likely impact policy in June and beyond. Technical analysis: USD/INR maintains a constructive outlook in the longer termThe Indian Rupee trades stronger on the day. The positive outlook of USD/INR remains unchanged on the daily chart as the pair is above the key 100-day Exponential Moving Average (EMA). However, the 14-day Relative Strength Index (RSI) holds in bearish territory around 48.00, suggesting the potential decline cannot be ruled out.
The first downside target of USD/INR will emerge near the confluence of the 100-day EMA and a low of April 10 in the 83.10–83.15 region. A decisive break below this level will see a drop to a low of January 15 at 82.78, followed by a low of March 16 at 82.65. On the upside, the immediate resistance level is seen near a high of April 15 at 83.50. Further north, the next hurdle is located near an all-time high of 83.72, en route to the 84.00 psychological level.US Dollar price todayThe table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the New Zealand Dollar. USDEURGBPCADAUDJPYNZDCHFUSD 0.04% 0.04% -0.03% -0.03% -0.04% -0.06% 0.02%EUR-0.02% -0.01% -0.05% -0.08% -0.06% -0.10% -0.01%GBP-0.04% 0.00% -0.05% -0.09% -0.08% -0.12% -0.01%CAD0.02% 0.05% 0.05% -0.04% 0.00% -0.07% 0.04%AUD0.03% 0.09% 0.09% 0.04% 0.04% -0.03% 0.08%JPY0.04% 0.07% 0.07% 0.02% 0.00% -0.03% 0.06%NZD0.06% 0.12% 0.12% 0.08% 0.03% 0.04% 0.11%CHF-0.01% 0.01% 0.01% -0.04% -0.07% -0.05% -0.09% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
Market players will keep an eye on the final reading of the US March Personal Consumption Expenditures Price Index (PCE), which might offer some hints about the inflation trajectory in the US and point to the Federal Reserve's (Fed) next move. Apart from this, India’s general election, which started on 19 April and will run until 1 June, will be closely watched. Daily Digest Market Movers: Indian Rupee remains firm amid global challengesThe Indian Rupee was the least volatile major currency among its emerging market peers and a few advanced economies in the financial year 2023–24, according to the Monthly Economic Review report of the Department of Economic Affairs under the Ministry of Finance. The report added that India’s foreign exchange reserves reached an all-time high in March 2024, sufficient to cover 11 months of projected imports and more than 100% of total external debt. The first estimate of US Gross Domestic Product (GDP) grew by 1.6% on an annualized basis in the first quarter (Q1) of 2024, compared to a 3.4% growth in Q4 2023, below the market consensus of 2.5%. The US Personal Consumption Expenditures Prices (PCE) rose at an annualized rate of 3.4% in Q1, nearly double the 1.8% pace recorded in Q4 2023. HSBC analysts expect the Fed to leave its policy rate unchanged in May and said that economic growth and core inflation data in the coming months will likely impact policy in June and beyond. Technical analysis: USD/INR maintains a constructive outlook in the longer termThe Indian Rupee trades stronger on the day. The positive outlook of USD/INR remains unchanged on the daily chart as the pair is above the key 100-day Exponential Moving Average (EMA). However, the 14-day Relative Strength Index (RSI) holds in bearish territory around 48.00, suggesting the potential decline cannot be ruled out.
The first downside target of USD/INR will emerge near the confluence of the 100-day EMA and a low of April 10 in the 83.10–83.15 region. A decisive break below this level will see a drop to a low of January 15 at 82.78, followed by a low of March 16 at 82.65. On the upside, the immediate resistance level is seen near a high of April 15 at 83.50. Further north, the next hurdle is located near an all-time high of 83.72, en route to the 84.00 psychological level.US Dollar price todayThe table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the New Zealand Dollar. USDEURGBPCADAUDJPYNZDCHFUSD 0.04% 0.04% -0.03% -0.03% -0.04% -0.06% 0.02%EUR-0.02% -0.01% -0.05% -0.08% -0.06% -0.10% -0.01%GBP-0.04% 0.00% -0.05% -0.09% -0.08% -0.12% -0.01%CAD0.02% 0.05% 0.05% -0.04% 0.00% -0.07% 0.04%AUD0.03% 0.09% 0.09% 0.04% 0.04% -0.03% 0.08%JPY0.04% 0.07% 0.07% 0.02% 0.00% -0.03% 0.06%NZD0.06% 0.12% 0.12% 0.08% 0.03% 0.04% 0.11%CHF-0.01% 0.01% 0.01% -0.04% -0.07% -0.05% -0.09% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
05:11 AUD/JPY hovers around five-month highs ahead of BoJ's policy decision
AUD/JPY extends its winning streak for the fifth consecutive session on Friday.
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Australia’s Consumer Price Index (CPI) data on Wednesday, surpassing expectations, is also playing a role in an increase in Australian government bond yields as traders price out expectations regarding interest rate cuts by the RBA in 2024. The Australian 10-year Government Bond Yield has reached a 21-week high of 4.59%, indicating a significant upward trend.
The Japanese Yen (JPY) depreciated following the release of Japan's Tokyo Consumer Price Index (CPI), which came in well below expectations early Friday. This print marks the second time this year that inflation has fallen below the Bank of Japan's (BoJ) 2% target, reducing pressure on the central bank to raise interest rates again. As a result, market sentiment is shifting towards the expectation that the BoJ will abstain from implementing rate hikes during its meeting on Friday.
Daily Digest Market Movers: AUD/JPY gains ground after weaker Tokyo’s CPI data Tokyo Consumer Price Index rose 1.8% YoY in April, well below the previous print of 2.6%. Markets were broadly expecting Tokyo inflation to hold steady over the period. The Core CPI fell sharply to 1.6% year-on-year, marking its lowest level since March 2022 and falling well below forecasts of 2.2%. SocGen's assessment of the potential for USD/JPY to test the Japanese Ministry of Finance's intervention limits due to persistent US rate expectations and recent market dynamics suggests a significant focus on the interplay between US economic data and currency movements. On Friday, a report from Reuters said that the Bank of Japan (BOJ) is expected to project that inflation will remain close to its 2% target in the coming years and signal its preparedness to raise interest rates from their near-zero levels. This stance by the BOJ is aimed at preventing yen depreciation and discouraging market participants from pushing the currency to fresh 34-year lows. Jiji news agency reported on Thursday that the Bank of Japan (BOJ) might reduce its bond purchases appears to be exerting a more significant influence on the market sentiment compared to the lower-than-expected Tokyo Consumer Price Index (CPI) data released today. According to Luci Ellis, Westpac's chief economist and former Assistant Governor (Economic) at the Reserve Bank of Australia, inflation slightly surpassed expectations in the March quarter. They anticipate the Board will maintain interest rates in May and have revised the projected date for the initial rate reduction from September to November this year. According to analysts at Barrenjoey Capital Partners, a leading Australian investment banking firm, advised to utilize the trimmed mean to rank Australia's inflation. Australia's six-month annualized rate of trimmed mean inflation, standing at 3.6%, is notably the highest worldwide, surpassing even the United States' 3.2% six-month annualized rate of trimmed mean inflation. Australia’s Consumer Price Index (CPI) rose by 1.0% QoQ in the first quarter of 2024, against the expected 0.8% and 0.6% prior. CPI (YoY) increased by 3.6% compared to the forecast of 3.4% for Q1 and 4.1% prior. Australia’s Monthly Consumer Price Index (YoY) rose by 3.5% in March, against the market expectations and the previous reading of 3.4%. According to the Japan Times, the proportion of Japanese companies intending to increase their pay scales reached 70.7%, marking a rise of 6.3 percentage points from the previous year. Additionally, the number of companies planning to implement pay-scale hikes and regular pay increases totaling 5% or more amounted to 36.5%, nearly doubling from the previous year. This could provide support for the Yen.
Technical Analysis: AUD/JPY hovers around the major level of 101.50
The AUD/JPY trades around 101.50 on Friday, testing the upper boundary of the daily ascending channel, trading around a fresh five-month high of 101.66. Additionally, the 14-day Relative Strength Index (RSI) is trending above the 50-level, strengthening the bullish sentiment. The immediate resistance is seen at the psychological level of 102.00.
On the downside, immediate support for the AUD/JPY pair could be found at the psychological level of 101.00. If the pair breaches below this level, it suggests a bearish sentiment may prevail and might lead the AUD/JPY cross to a further decline toward the psychological level of 100.00, followed by the 21-day Exponential Moving Average (EMA) at the level of 99.87. Further depreciation will likely test the lower boundary of the ascending channel around the level of 99.00.
AUD/JPY: Daily ChartAustralian Dollar price today
The table below shows the percentage change of the Australian Dollar (AUD) against listed major currencies today. The Australian Dollar was the strongest against the Swiss Franc. USDEURGBPCADAUDJPYNZDCHFUSD 0.00% 0.02% -0.04% -0.10% 0.01% -0.13% 0.05%EUR0.00% 0.01% -0.02% -0.10% 0.00% -0.13% 0.05%GBP-0.01% -0.02% -0.04% -0.12% 0.00% -0.17% 0.04%CAD0.03% 0.03% 0.03% -0.08% 0.03% -0.13% 0.06%AUD0.10% 0.10% 0.12% 0.08% 0.11% -0.05% 0.16%JPY-0.01% -0.01% -0.01% -0.04% -0.12% -0.15% 0.04%NZD0.13% 0.15% 0.16% 0.12% 0.04% 0.16% 0.21%CHF-0.06% -0.06% -0.03% -0.09% -0.15% -0.05% -0.19%
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Australian Dollar FAQs What key factors drive the Australian Dollar?
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar?
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar?
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar?
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
04:55 China’s Foreign Minister Wang: Relationship has stabilized with US but negative factors are building
Following his meeting with US Secretary of State Antony Blinken early Friday, China’s Foreign Minister Wang Yi said that the Sino-US “relationship has stabilized but negative factors are building.” Additional comments Sliding into conflict with the US would be a lose-lose situation.
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Following his meeting with US Secretary of State Antony Blinken early Friday, China’s Foreign Minister Wang Yi said that the Sino-US “relationship has stabilized but negative factors are building.”
Additional comments
Sliding into conflict with the US would be a lose-lose situation.
We urge the US not to interfere with China's internal affairs.
In response, Blinken said that “there is no substitute for face-to-face diplomacy,” adding that “we need to avoid miscalculations.”
Blinken said that he “hopes the US and China can make progress on agreements, citing fentanyl, military-to-military ties and AI risks.”
Market reaction
At the press time, AUD/USD is holding higher ground near 0.6530, unperturbed by these comments. The spot is up 0.21% on the day.
Australian Dollar FAQs What key factors drive the Australian Dollar?
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar?
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar?
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar?
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
04:48 WTI rebounds above $83.50 as market weighs disappointing US GDP data against geopolitical fears
Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $83.60 on Friday.
WTI recovers to $83.60 in Friday’s early Asian session.The expectation that the Fed might delay rate cuts weighs on the black gold. The concern over oil supply disruptions amid renewed geopolitical tensions lifts the black gold.Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $83.60 on Friday. The black gold edges higher as the market weighed the weaker-than-expected US economic growth data against a potential geopolitical risk from a looming Israeli invasion of the southern Gaza city of Rafah.
WTI prices face some sell-off following the GDP report from the Commerce Department on Thursday. The US economy expanded at its slowest pace in nearly two years in the first quarter (Q1) of 2024 as inflation rose at a faster pace. The advanced US GDP grew by 1.6% on an annualized basis in the first quarter (Q1) in 2024, compared to a 3.4% growth in Q4 2023. This reading came in below the market estimation of 2.5%. Additionally, the inflation in the United States remains elevated and it might trigger the speculation that the Federal Reserve will not cut interest rates before September.
However, WTI prices recover and hold positive ground after Treasury Secretary Janet Yellen said that US economic growth was likely stronger than suggested by weaker-than-expected quarterly data.
Apart from this, the concern over oil supply disruption amid the escalating geopolitical tensions boosts the black gold. Israel launched airstrikes on Rafah as the country made preparations to invade the city, per Reuters.
The worries about the largest drawdown in US commercial crude stockpiles since mid-January also lift the WTI prices. The Energy Information Administration (EIA) reported that crude inventories for the week ending April 19 fell by 6.368 million barrels from the previous reading of 2.735 million barrels built. WTI US OIL Overview Today last price 83.59 Today Daily Change 0.03 Today Daily Change % 0.04 Today daily open 83.56 Trends Daily SMA20 84.16 Daily SMA50 81.13 Daily SMA100 77.34 Daily SMA200 79.75 Levels Previous Daily High 83.58 Previous Daily Low 81.79 Previous Weekly High 85.67 Previous Weekly Low 81.05 Previous Monthly High 83.05 Previous Monthly Low 76.5 Daily Fibonacci 38.2% 82.9 Daily Fibonacci 61.8% 82.48 Daily Pivot Point S1 82.37 Daily Pivot Point S2 81.18 Daily Pivot Point S3 80.58 Daily Pivot Point R1 84.17 Daily Pivot Point R2 84.77 Daily Pivot Point R3 85.96
WTI prices face some sell-off following the GDP report from the Commerce Department on Thursday. The US economy expanded at its slowest pace in nearly two years in the first quarter (Q1) of 2024 as inflation rose at a faster pace. The advanced US GDP grew by 1.6% on an annualized basis in the first quarter (Q1) in 2024, compared to a 3.4% growth in Q4 2023. This reading came in below the market estimation of 2.5%. Additionally, the inflation in the United States remains elevated and it might trigger the speculation that the Federal Reserve will not cut interest rates before September.
However, WTI prices recover and hold positive ground after Treasury Secretary Janet Yellen said that US economic growth was likely stronger than suggested by weaker-than-expected quarterly data.
Apart from this, the concern over oil supply disruption amid the escalating geopolitical tensions boosts the black gold. Israel launched airstrikes on Rafah as the country made preparations to invade the city, per Reuters.
The worries about the largest drawdown in US commercial crude stockpiles since mid-January also lift the WTI prices. The Energy Information Administration (EIA) reported that crude inventories for the week ending April 19 fell by 6.368 million barrels from the previous reading of 2.735 million barrels built. WTI US OIL Overview Today last price 83.59 Today Daily Change 0.03 Today Daily Change % 0.04 Today daily open 83.56 Trends Daily SMA20 84.16 Daily SMA50 81.13 Daily SMA100 77.34 Daily SMA200 79.75 Levels Previous Daily High 83.58 Previous Daily Low 81.79 Previous Weekly High 85.67 Previous Weekly Low 81.05 Previous Monthly High 83.05 Previous Monthly Low 76.5 Daily Fibonacci 38.2% 82.9 Daily Fibonacci 61.8% 82.48 Daily Pivot Point S1 82.37 Daily Pivot Point S2 81.18 Daily Pivot Point S3 80.58 Daily Pivot Point R1 84.17 Daily Pivot Point R2 84.77 Daily Pivot Point R3 85.96
04:47 Japanese Yen hangs near multi-decade low against USD ahead of BoJ policy decision
The Japanese Yen (JPY) languishes near a multi-decade low against its American counterpart during the Asian session on Friday as traders keenly await the outcome of the highly-anticipated Bank of Japan (BoJ) policy meeting.
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In the meantime, the lack of any decisive action by Japanese authorities to support the domestic currency fails to provide any respite to the JPY bulls. Meanwhile, the US Dollar (USD) hangs near a two-week low touched on Thursday in reaction to data showing a sharp slowdown in the US economic growth, which, in turn, caps the upside for the USD/JPY pair. That said, an unwelcome pickup in inflation reaffirmed market bets that the Federal Reserve (Fed) will keep interest rates higher for longer, which should act as a tailwind for the currency pair ahead of the US Personal Consumption Expenditures (PCE) Price Index.
Daily Digest Market Movers: Japanese Yen bulls remain on the sidelines ahead of BoJ and the key US macro data Government data showed on Friday that consumer inflation in Tokyo decelerated sharply in April and dashed hopes for any hawkish signals from the Bank of Japan, undermining the Japanese Yen. The headline Tokyo Consumer Price Index (CPI) rose 1.8% YoY in April, while core CPI (ex-Fresh Food, Energy) increased by 1.8% YoY during the reported month, both missing consensus estimates. A core CPI gauge that excludes both fresh food and energy prices and is closely watched by the BoJ as a gauge of underlying inflation fell below the 2% target for the first time since September 2022. From the US, the Commerce Department reported on Thursday that Gross Domestic Product grew at a 1.6% annualized rate in the January-March period, marking the weakest reading since mid-2022. This pointed to a significant loss of momentum at the start of 2024, though was offset by a rise in the underlying inflation, which reaffirmed bets that the Federal Reserve will keep rates higher for longer. A Jiji report indicated that the BoJ might buy fewer bonds, pushing Japan’s five-year bond yield to the highest level since April 2011, albeit does little to provide any meaningful boost to the JPY. Japan's Finance Minister Shunichi Suzuki reiterated that he is closely monitoring FX fluctuations and that he will prepare to take full steps on the currency, though declined to comment on details of the policy. Meanwhile, traders now seem reluctant and prefer to wait for the crucial BoJ policy decision, which will be followed by the release of the US Personal Consumption Expenditures (PCE) Price Index.
Technical Analysis: USD/JPY is likely to confront stiff resistance near 156.00 amid overbought RSI on the daily chart
From a technical perspective, momentum beyond the overnight swing high, around the 155.75 zone, has the potential to lift the USD/JPY pair to the 156.00 mark. The latter should act as a strong barrier and cap the upside amid the extremely overbought Relative Strength Index (RSI) on the daily chart, which, in turn, warrants some caution for bullish traders.
On the flip side, the 155.35-155.30 region is likely to protect the immediate downside ahead of the 155.00 psychological mark. This is closely followed by a short-term trading range resistance breakpoint, around the 154.70 area, below which the USD/JPY pair could drop to the 154.00 round figure en route to last Friday's swing low, around the 153.60-153.55 zone.
Japanese Yen FAQs What key factors drive the Japanese Yen?
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen?
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. How does the differential between Japanese and US bond yields impact the Japanese Yen?
The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. How does broader risk sentiment impact the Japanese Yen?
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
04:31 Australia Export Price Index (QoQ) dipped from previous 5.6% to -2.1% in 1Q
Australia Export Price Index (QoQ) dipped from previous 5.6% to -2.1% in 1Q
04:31 Australia Import Price Index (QoQ) below forecasts (0.1%) in 1Q: Actual (-1.8%)
Australia Import Price Index (QoQ) below forecasts (0.1%) in 1Q: Actual (-1.8%)
04:30 Australia Producer Price Index (QoQ) remains unchanged at 0.9% in 1Q
Australia Producer Price Index (QoQ) remains unchanged at 0.9% in 1Q
04:30 Australia Producer Price Index (YoY) increased to 4.3% in 1Q from previous 4.1%
Australia Producer Price Index (YoY) increased to 4.3% in 1Q from previous 4.1%
04:19 PBoC sets USD/CNY reference rate at 7.1056 vs 7.1058 previous
On Friday, the People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead at 7.1056 as compared to the previous day's fix of 7.1058 and 7.2396 Reuters estimates.
On Friday, the People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead at 7.1056 as compared to the previous day's fix of 7.1058 and 7.2396 Reuters estimates.
03:47 Japan 5-year yields climb to the highest since April 2011 ahead of BoJ rate decision
Japan’s five-year bond yield rose to the highest level since April 2011 ahead of the Bank of Japan (BoJ) interest rate decision on Friday, per A Jiji.
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Japan’s five-year bond yield rose to the highest level since April 2011 ahead of the Bank of Japan (BoJ) interest rate decision on Friday, per A Jiji. The yield advanced 2.5 basis points (bps) to 0.523% in the early Asian session on Friday.
The Bank of Japan (BoJ) is expected to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. Market reaction At the time of writing, USD/JPY is trading 0.02% lower on the day to trade at 155.62. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. How does the differential between Japanese and US bond yields impact the Japanese Yen? The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
The Bank of Japan (BoJ) is expected to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. Market reaction At the time of writing, USD/JPY is trading 0.02% lower on the day to trade at 155.62. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. How does the differential between Japanese and US bond yields impact the Japanese Yen? The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
03:31 GBP/USD trades on a softer note below 1.2530 ahead of US PCE data
The GBP/USD pair trades on a weaker note around 1.2502 during the early Asian trading hours on Friday.
GBP/USD snaps the three-day winning streak near 1.2502 in Friday’s early Asian session. The US economy grew at a slower pace of 1.6% in Q1 2024, compared to 3.4% in the previous reading. The expectation that the BoE will cut rates before the US Fed might exert some selling pressure on the GBP. The GBP/USD pair trades on a weaker note around 1.2502 during the early Asian trading hours on Friday. The modest rebound of the US Dollar (USD) weighs on the major pair despite weaker US GDP growth numbers. The US Personal Consumption Expenditures (PCE) Price Index data on Friday will be in the spotlight.
On Thursday, the US economy grew at a slower pace of 1.6% in the first quarter (Q1) of 2024, compared to 3.4% in the previous reading. This figure came in weaker than the market expectation of 2.5%. However, prices have remained sticky, with the data on Thursday revealing the Personal Consumption Expenditures Price Index in Q1 climbing at a 3.4% annual rate, above the Fed's 2% target. The Greenback has dropped to two-week lows near mid-105.00 after the release of weaker-than-expected Q1 GDP growth and a hotter-than-expected inflation reading.
According to the CME FedWatch tool, financial markets have priced in less than 10% odds that the US Federal Reserve (Fed) will cut interest rates in June, while the probability of a September rate cut dropping below 58%. Investors will take more cues from another inflation report on Friday. The US PCE is expected to show an increase of 0.3% MoM in both headline and core PCE figures. On an annual basis, the headline PCE and Core PCE figures are estimated to show a rise of 2.6% and 2.7% YoY, respectively.
On the GBP’s front, the Bank of England (BoE) Governor Andrew Bailey and other BoE policymakers stated that inflation in the United Kingdom dropped in line with the central bank's expectations and the risk of elevated inflation had reduced, paving the way for a rate cut. The market anticipates that the UK central bank will wait until next quarter to lower borrowing costs, and it will begin before the US Fed. This, in turn, might cap the upside of the Pound Sterling (GBP). GBP/USD Overview Today last price 1.2505 Today Daily Change -0.0009 Today Daily Change % -0.07 Today daily open 1.2514 Trends Daily SMA20 1.2524 Daily SMA50 1.2626 Daily SMA100 1.2651 Daily SMA200 1.2559 Levels Previous Daily High 1.2527 Previous Daily Low 1.2454 Previous Weekly High 1.2499 Previous Weekly Low 1.2367 Previous Monthly High 1.2894 Previous Monthly Low 1.2575 Daily Fibonacci 38.2% 1.2499 Daily Fibonacci 61.8% 1.2482 Daily Pivot Point S1 1.247 Daily Pivot Point S2 1.2426 Daily Pivot Point S3 1.2397 Daily Pivot Point R1 1.2542 Daily Pivot Point R2 1.2571 Daily Pivot Point R3 1.2614
On Thursday, the US economy grew at a slower pace of 1.6% in the first quarter (Q1) of 2024, compared to 3.4% in the previous reading. This figure came in weaker than the market expectation of 2.5%. However, prices have remained sticky, with the data on Thursday revealing the Personal Consumption Expenditures Price Index in Q1 climbing at a 3.4% annual rate, above the Fed's 2% target. The Greenback has dropped to two-week lows near mid-105.00 after the release of weaker-than-expected Q1 GDP growth and a hotter-than-expected inflation reading.
According to the CME FedWatch tool, financial markets have priced in less than 10% odds that the US Federal Reserve (Fed) will cut interest rates in June, while the probability of a September rate cut dropping below 58%. Investors will take more cues from another inflation report on Friday. The US PCE is expected to show an increase of 0.3% MoM in both headline and core PCE figures. On an annual basis, the headline PCE and Core PCE figures are estimated to show a rise of 2.6% and 2.7% YoY, respectively.
On the GBP’s front, the Bank of England (BoE) Governor Andrew Bailey and other BoE policymakers stated that inflation in the United Kingdom dropped in line with the central bank's expectations and the risk of elevated inflation had reduced, paving the way for a rate cut. The market anticipates that the UK central bank will wait until next quarter to lower borrowing costs, and it will begin before the US Fed. This, in turn, might cap the upside of the Pound Sterling (GBP). GBP/USD Overview Today last price 1.2505 Today Daily Change -0.0009 Today Daily Change % -0.07 Today daily open 1.2514 Trends Daily SMA20 1.2524 Daily SMA50 1.2626 Daily SMA100 1.2651 Daily SMA200 1.2559 Levels Previous Daily High 1.2527 Previous Daily Low 1.2454 Previous Weekly High 1.2499 Previous Weekly Low 1.2367 Previous Monthly High 1.2894 Previous Monthly Low 1.2575 Daily Fibonacci 38.2% 1.2499 Daily Fibonacci 61.8% 1.2482 Daily Pivot Point S1 1.247 Daily Pivot Point S2 1.2426 Daily Pivot Point S3 1.2397 Daily Pivot Point R1 1.2542 Daily Pivot Point R2 1.2571 Daily Pivot Point R3 1.2614
03:07 Japan’s Suzuki prepares to take full steps on FX
Japanese Finance Minister Shunichi Suzuki said on Friday that he is closely monitoring foreign exchange (FX) fluctuations.
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Japanese Finance Minister Shunichi Suzuki said on Friday that he is closely monitoring foreign exchange (FX) fluctuations. Suzuki further stated that he will prepare to take full steps on the currency. However, he declined to comment on forex and policy details.Key quotes“Declines to comment on forex and policy details.”
“We will take all necessary measures when needed.”
“He is closely monitoring currency fluctuations.”
“There are positive and negative elements of weak yen.”
“Prepared to Take Full Steps on FX.”
“Concerned about negative effects of weak yen.”Market reaction At the time of writing, USD/JPY is trading 0.02% lower on the day to trade at 155.72.
Japanese Yen FAQs What key factors drive the Japanese Yen?
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen?
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. How does the differential between Japanese and US bond yields impact the Japanese Yen?
The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. How does broader risk sentiment impact the Japanese Yen?
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
02:44 USD/JPY holds near 155.50 after Tokyo CPI inflation eases more than expected
Japan’s Tokyo Consumer Price Inflation (CPI) inflation printed well below expectations early Friday, which will complicate the Bank of Japan’s (BoJ) upcoming rate call and Monetary Policy Report, due during the Pacific market session.
Japan’s Tokyo CPI inflation fell below forecasts early Friday.US data confounded rate-hungry investors on Thursday.Markets await BoJ rate call, US PCE Price Index figures.Japan’s Tokyo Consumer Price Inflation (CPI) inflation printed well below expectations early Friday, which will complicate the Bank of Japan’s (BoJ) upcoming rate call and Monetary Policy Report, due during the Pacific market session.
Tokyo CPI inflation rose only 1.8% on an annualized basis in April, well below the previous print of 2.6%. Markets were broadly expecting Tokyo inflation to hold steady over the period.Read more: Tokyo Consumer Price Index rises 1.8% YoY in April vs. 2.6% expectedUS Gross Domestic Product (GDP) also eased faster than expected, prompting discouragement in risk appetite on Thursday. Further complicating matters, US Personal Consumption Expenditure (PCE) inflation remained stubbornly higher in the first quarter than investors hoping for Federal Reserve (Fed) rate cuts were hoping for.
US PCE Price Index inflation will deliver a fine-tuned look at US inflation later Friday. US MoM Core PCE Price Index numbers for March are forecast to hold steady at 0.3%.
With the Japanese Yen (JPY) trading into multi-year lows across the board, the BoJ is expected to begin weighing market interventions. According to reporting by Nikkei, the Japanese central bank is expected to discuss intervention options to help bolster the battered Yen.
USD/JPY technical outlook
USD/JPY is trading tightly just below the 156.00 handle, hugging multi-year highs as the Yen continues to deflate. The pair is trading into 30-plus year highs, and bullish momentum is targeting all-time record bids beyond 160.00, a price level the pair hasn’t reached since 1990.
The USD/JPY pair is on pace to close bullish for a fourth consecutive month, and is up 10.4% in 2024.
USD/JPY hourly chart
USD/JPY daily chart
02:36 Japan Inflation: Tokyo Consumer Price Index rises 1.8% YoY in April vs. 2.6% expected
The headline Tokyo Consumer Price Index (CPI) for April rose 1.8% YoY, compared to a 2.6% rise in the previous reading, the Statistics Bureau of Japan showed on Friday.
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The headline Tokyo Consumer Price Index (CPI) for April rose 1.8% YoY, compared to a 2.6% rise in the previous reading, the Statistics Bureau of Japan showed on Friday. Meanwhile, the Tokyo CPI ex Fresh Food, Energy increased 1.8% YoY versus 2.7% expected and the previous reading of 2.9% rise.
Additionally, Tokyo CPI ex Fresh Food rose 1.6% for the said month, below the market consensus of 2.4%.Market reactionAs of writing, the USD/JPY pair was down 0.01% on the day at 155.63.
Inflation FAQs What is inflation?
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)?
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange?
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold?
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
02:32 Japan Tokyo CPI ex Fresh Food (YoY) came in at 1.6%, below expectations (2.2%) in April
Japan Tokyo CPI ex Fresh Food (YoY) came in at 1.6%, below expectations (2.2%) in April
02:31 Japan Tokyo CPI ex Food, Energy (YoY) below expectations (2.7%) in April: Actual (1.8%)
Japan Tokyo CPI ex Food, Energy (YoY) below expectations (2.7%) in April: Actual (1.8%)
02:30 Japan Tokyo Consumer Price Index (YoY) registered at 1.8%, below expectations (2.6%) in April
Japan Tokyo Consumer Price Index (YoY) registered at 1.8%, below expectations (2.6%) in April
02:10 USD/CAD extends its downside below 1.3670, investors await US PCE data
The USD/CAD pair extends its downside near 1.3655 on Friday during the early Asian session.
USD/CAD remains on the defensive around 1.3655 on Friday amid the weaker USD. US GDP number expanded by 1.6% on an annualized basis in Q1 2024, compared to 3.4% growth in Q4 2023.The weaker Canadian Retail Sales data triggered speculation that the BoC might start cutting interest rates in June. The USD/CAD pair extends its downside near 1.3655 on Friday during the early Asian session. The decline of the US Dollar (USD) to the two-week lows around the mid-105.00s exerts some selling pressure on the pair. Investors now shift their focus to the release of US Personal Consumption Expenditures (PCE) Price Index data, due later on Friday.
The US economy grew at its slowest pace in nearly two years in the first quarter (Q1) of 2024 as prices rose at a faster pace, the Commerce Department revealed on Thursday. The first estimate of US Gross Domestic Product (GDP) grew by 1.6% on an annualized basis in the January-March period, compared to a 3.4% growth in Q4 2023. This reading came in below the market consensus of 2.5%. Additionally, US Personal Consumption Expenditures Prices rose at an annualized rate of 3.4% in Q1, nearly double the 1.8% pace recorded in Q4 2023.
The weaker-than-expected GDP growth and hotter-than-expected inflation weigh on the Greenback and create a headwind for USD/CAD. The markets expect the US Federal Reserve (Fed) to begin the first rate cuts in September, with traders now pointing to just one rate cut in 2024 following the GDP data, according to the CME FedWatch tool.
On the Loonie front, the weaker Canadian Retail Sales data on Wednesday triggered speculation that the Bank of Canada (BoC) might start cutting interest rates at its next meeting in June, which might drag the Canadian Dollar (CAD) lower. Nonetheless, the rebound of crude oil prices provides some support to the CAD, as Canada is the largest crude oil exporter to the United States (US). USD/CAD Overview Today last price 1.3657 Today Daily Change -0.0046 Today Daily Change % -0.34 Today daily open 1.3703 Trends Daily SMA20 1.3657 Daily SMA50 1.3579 Daily SMA100 1.3498 Daily SMA200 1.3537 Levels Previous Daily High 1.3729 Previous Daily Low 1.3655 Previous Weekly High 1.3846 Previous Weekly Low 1.3724 Previous Monthly High 1.3614 Previous Monthly Low 1.342 Daily Fibonacci 38.2% 1.3701 Daily Fibonacci 61.8% 1.3683 Daily Pivot Point S1 1.3662 Daily Pivot Point S2 1.3622 Daily Pivot Point S3 1.3588 Daily Pivot Point R1 1.3737 Daily Pivot Point R2 1.377 Daily Pivot Point R3 1.3811
The US economy grew at its slowest pace in nearly two years in the first quarter (Q1) of 2024 as prices rose at a faster pace, the Commerce Department revealed on Thursday. The first estimate of US Gross Domestic Product (GDP) grew by 1.6% on an annualized basis in the January-March period, compared to a 3.4% growth in Q4 2023. This reading came in below the market consensus of 2.5%. Additionally, US Personal Consumption Expenditures Prices rose at an annualized rate of 3.4% in Q1, nearly double the 1.8% pace recorded in Q4 2023.
The weaker-than-expected GDP growth and hotter-than-expected inflation weigh on the Greenback and create a headwind for USD/CAD. The markets expect the US Federal Reserve (Fed) to begin the first rate cuts in September, with traders now pointing to just one rate cut in 2024 following the GDP data, according to the CME FedWatch tool.
On the Loonie front, the weaker Canadian Retail Sales data on Wednesday triggered speculation that the Bank of Canada (BoC) might start cutting interest rates at its next meeting in June, which might drag the Canadian Dollar (CAD) lower. Nonetheless, the rebound of crude oil prices provides some support to the CAD, as Canada is the largest crude oil exporter to the United States (US). USD/CAD Overview Today last price 1.3657 Today Daily Change -0.0046 Today Daily Change % -0.34 Today daily open 1.3703 Trends Daily SMA20 1.3657 Daily SMA50 1.3579 Daily SMA100 1.3498 Daily SMA200 1.3537 Levels Previous Daily High 1.3729 Previous Daily Low 1.3655 Previous Weekly High 1.3846 Previous Weekly Low 1.3724 Previous Monthly High 1.3614 Previous Monthly Low 1.342 Daily Fibonacci 38.2% 1.3701 Daily Fibonacci 61.8% 1.3683 Daily Pivot Point S1 1.3662 Daily Pivot Point S2 1.3622 Daily Pivot Point S3 1.3588 Daily Pivot Point R1 1.3737 Daily Pivot Point R2 1.377 Daily Pivot Point R3 1.3811
02:01 United Kingdom GfK Consumer Confidence above expectations (-20) in April: Actual (-19)
United Kingdom GfK Consumer Confidence above expectations (-20) in April: Actual (-19)
02:01 Ireland Consumer Confidence down to 67.8 in April from previous 69.5
Ireland Consumer Confidence down to 67.8 in April from previous 69.5
02:00 Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan (BoJ) is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April.
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The BoJ hiked the interest rate for the first time in 17 years in March, lifting Japan out of the negative interest rate policy (NIRP) for the first time since 2016.
What to expect from the BoJ interest rate decision?
With a steady policy widely expected, the markets’ attention will remain on the BoJ’s quarterly inflation and growth forecasts and the probable changes in the policy statement for fresh hints on the timing of the Bank’s next rate increase.
Markets are expecting the BoJ to hike rates again this year, with odds split between the chance of a lift-off in July, or sometime in the October-December quarter, according to Reuters.
Kyodo News Agency reported on Friday, citing sources familiar with the BoJ thinking, that the Japanese central bank is mulling an upward revision to its inflation outlook for fiscal year 2024 from the current 2.4%. The bank is also seen raising its forecast for fiscal year 2025 from 1.8% to around 2.0% while forecasting Japan's core inflation to be around 2% in fiscal 2026, the sources added.
These expectations hold even as Japan’s core Consumer Price Index (CPI) – a measure excluding fresh food and energy costs closely watched by the BoJ – moderated to 2.9% in March after increasing 3.2% in February. It was the first time since November 2022 that core inflation fell below 3%.
Easing price pressures in Japan fail to deter the BoJ’s path forward on interest rates, as the recent depreciation of the Japanese Yen (JPY) is likely to significantly push up inflation. Further, the BoJ focus remains on the potential increases in the services inflation and wages to determine the appropriate time for the next rate hike.
Japanese firms offered their biggest wage hikes in 33 years this year but the inflation-adjusted real wages have continued to decline for nearly two years.
When asked about the possibility of further rate hikes this year, in an interview with the Asahi newspaper earlier this month, BoJ Governor Kazuo Ueda said that "it's dependent on data.” "We'll adjust interest rates according to the distance towards sustainably and stably hitting 2% inflation”, Ueda added.
On Tuesday, Governor Ueda said that the BoJ will raise rates again if trend inflation accelerates toward its 2% target as expected. Japan's Weighted Median Inflation Index, a key measure of the country’s trend inflation, rose at its slowest pace in 11 months to 1.3% in March, the latest data published by the Bank of Japan (BoJ) showed on Tuesday.
Governor Ueda’s remarks imply that the central bank is shifting to a more discretionary approach in setting policy. The BoJ could remain on track to deliver another rate hike this year as it gathers more confidence that Japan will sustainably achieve its 2% price target. Therefore, the country’s trend inflation, wage growth and consumption data will hold more importance than the central bank’s quarterly inflation projections in determining the Bank’s future interest rate decisions.
Analysts at BBH preview the BoJ policy announcements, noting that “we are sticking to our view that the BoJ tightening cycle will remain very modest. The market agrees and is pricing in only 20 bp of tightening in 2024 and 50 bp over the next two years. Such a modest cycle would likely keep upward pressure on USD/JPY.”
“Updated macro forecasts will be released. Reports emerged suggesting the BoJ may raise its inflation forecast for FY2024 from 2.4% currently at this meeting. However, March CPI data last week came in lower than expected and suggests falling price pressures, so the revision is likely to be minor,” the analysts explained.
How could the Bank of Japan interest rate decision affect USD/JPY?
If the BoJ policy statement delivers a hawkish tone, indicating that the next rate hike could be as early as July, the Japanese Yen is likely to see a fresh upswing against the US Dollar (USD). The USD/JPY pair would then initiate a corrective downtrend toward the 150.00 level.
On the other hand, if the central bank suggests that they would cautiously monitor the likelihood of achieving 2% trend inflation to gauge the next rate increase, it could be read as dovish. In such a case, the Japanese Yen could crash to a new 34-year low against the US Dollar.
It’s worth noting that the Japanese Yen tends to weaken on BoJ decision days. It has done so for eight straight and nine of the past ten meetings, per BBH Analysts.
From a technical perspective, Dhwani, Senior Analyst at FXStreet, notes: “Amid extremely overbought Relative Strength Index (RSI) conditions on the daily chart, a USD/JPY correction seems long overdue. Should a hawkish BoJ guidance spark a Japanese Yen rally, the pair will pull back sharply toward the 21-day Simple Moving Average (SMA) at 153.19. Ahead of that level, the April 23 low of 154.55 could challenge bearish commitments. If the corrective decline gains traction, USD/JPY could accelerate toward the 50-day SMA at 151.28.”
“On the flip side, the relentless vertical rise could extend toward 156.50, with buyers aiming for the 160.00 level predicted by a senior Liberal Democratic Party official to be a probable intervention point for the Japanese authorities,” Dhwani adds.
Economic Indicator
BoJ Interest Rate Decision
The Bank of Japan (BoJ) announces its interest rate decision after each of the Bank’s eight scheduled annual meetings. Generally, if the BoJ is hawkish about the inflationary outlook of the economy and raises interest rates it is bullish for the Japanese Yen (JPY). Likewise, if the BoJ has a dovish view on the Japanese economy and keeps interest rates unchanged, or cuts them, it is usually bearish for JPY. Read more. Next release: Fri Apr 26, 2024 03:00 Frequency: IrregularConsensus: 0.1%Previous: 0%Source: Bank of Japan Bank of Japan FAQs What is the Bank of Japan?
The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%. What has been the Bank of Japan’s policy?
The Bank of Japan has embarked in an ultra-loose monetary policy since 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. How do Bank of Japan’s decisions influence the Japanese Yen?
The Bank’s massive stimulus has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy of holding down rates has led to a widening differential with other currencies, dragging down the value of the Yen. Is the Bank of Japan’s ultra-loose policy likely to change soon?
A weaker Yen and the spike in global energy prices have led to an increase in Japanese inflation, which has exceeded the BoJ’s 2% target. Still, the Bank judges that the sustainable and stable achievement of the 2% target has not yet come in sight, so any sudden change in the current policy looks unlikely.
01:46 EUR/USD mired near 1.0730 after choppy Thursday market session
EUR/USD whipsawed somewhat on Thursday, and the pair is heading into Friday's early session near 1.0730 after a back-and-forth session and complicated US data that vexed rate cut hopes.
EUR/USD whipped on Thursday after mixed US data plagued markets.US GDP slowed faster than expected, but PCE inflation measures warn of still-high prices.US PCE Price Index figures due during Friday's US market session.EUR/USD whipsawed somewhat on Thursday, and the pair is heading into Friday's early session near 1.0730 after a back-and-forth session and complicated US data that vexed rate cut hopes.
US Gross Domestic Product (GDP) eased more than expected on Thursday, with annualized Q1 growth slowing to 1.6% compared to the previous 3.4%, and well below the forecast 2.5%. Easing growth is a boon for investors hoping for an accelerated pace of rate cuts from the Federal Reserve (Fed), but too much too fast could send negative knock-on effects throughout the US economy.
Hopes for rate cuts were further eroded after US Personal Consumption Expenditure (PCE) inflation accelerated again in the first quarter, with Q1 PCE rising 3.4% compared to the previous quarter’s 1.7%. Still-high inflation is reducing market hopes for rate cuts, sending risk appetite into a tailspin during the US trading session before markets staged a determined but limited recovery.
Friday brings mostly low-tier European data, and markets will be turning to face US PCE Price Index figures for March as investors look for a more fine-tuned look at the US’ inflation outlook. Core MoM PCE Price Index figures in March are expected to hold steady at 0.3%, with the annualized figure forecast to tick down slightly to 2.6% from 2.8%.
EUR/USD technical outlook
EUR/USD churns just north of the 200-hour Exponential Moving Average (EMA) at 1.0690, but Euro bidders are scrambling to keep the pair propped up beyond the 1.0700 handle. A near-term supply zone is priced in between 1.0880 and 1.0860, keeping interim bullish expectations pinned to the low side.
A recent drop below the 200-day EMA at 1.0795 threatens to crimp bullish sentiment despite a technical floor priced in near 1.0600.
EUR/USD hourly chart
EUR/USD daily chart
01:12 AUD/USD stand firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday.
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AUD/USD reflects continued market reaction to US data
Wall Street ended Thursday’s session with losses, which usually could’ve affected the Forex markets, but it didn’t. The US Dollar is under pressure following the release of a softer-than-expected GDP report, which, coupled with a surprise on a higher Core Personal Consumption Expenditure Price Index (PCE) on a quarterly basis, spurred investors to priced out rate cuts by the Fed.
Market pricing for the Fed's first 25 basis point (bps) rate cut was pushed back from September to November.
Other US data revealed that the labor market is still solid. There were 207 K Americans filing for unemployment claims, below estimates of 214K and the previous reading of 212 K.
AUD/USD traders sent the pair sliding towards its daily low of 0.6485 before recovering some ground. As Friday’s session begins, they will be eyeing the release of the Producer Price Index (PPI) in Australia and the US Core PCE figures on a monthly basis during the North American session.
AUD/USD Price Analysis: Technical outlook
Despite registering gain for the fourth straight day, the AUD/USD remains bearishly biased, with price action at 0.6525 below the 50 and 200-day moving averages (DMAs). If bulls gather momentum and push prices above that level, up next would be the 100-DMA at 0.6585, standing on their way to 0.6600. Conversely, further weakness could drag the pair below 0.6500. This paves the way for subsequent losses, with the next key support level at 0.6442, followed by the year-to-date (YTD) low at 0.6362.Australian Dollar FAQs What key factors drive the Australian Dollar?
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar?
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar?
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar?
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
01:06 New Zealand's ANZ Consumer Confidence slides to 82.1 in April
ANZ's New Zealand Roy Morgan Consumer Confidence slipped another 4 points to 82.1 in April, declining to the indicator's lowest levels since 2008.
ANZ's New Zealand Roy Morgan Consumer Confidence slipped another 4 points to 82.1 in April, declining to the indicator's lowest levels since 2008. Despite the decline, New Zealand consumer confidence remains higher than it did at the height of the pandemic.
Consumer inflation expectations eased to 4.4% from 4.5%, though housing price inflation expectations increased to 3.5% from 3.4%.
Market reaction
NZD/USD continues to trade in a tight but rough range as markets gear up for the early Friday session, stuck near the 0.5950 level.
About the ANZ Roy Morgan Consumer Confidence
The Consumer Confidence released by the ANZ is a leading index that measures the level of consumer confidence in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn. A high reading is seen as positive (or bullish) for the NZD, while a low reading is seen as negative (or bearish).
01:05 New Zealand ANZ – Roy Morgan Consumer Confidence declined to 82.1 in April from previous 86.4
New Zealand ANZ – Roy Morgan Consumer Confidence declined to 82.1 in April from previous 86.4
00:52 NZD/USD Price Analysis: Bears back off, potential trend reversal on cards tied to 20-day SMA recovery
The NZD/USD pair stands at 0.5949, registering daily gains on Thursday’s session.
The daily chart reveals a bearish bias for the NZD/USD pair underlined by its positioning below major SMAs.For bullish traction to take place, buyers must reclaim control over the 20-day SMA SMAs.Indicators on the daily chart recovered.The NZD/USD pair stands at 0.5949, registering daily gains on Thursday’s session. The prevailing outlook, as presented on the daily chart, shows a strong bearish control as the Kiwi continues to trade below the significant Simple Moving Averages (SMAs). Minor upticks visible in the short term do not suggest a meaningful trend reversal. For a bullish revival, bears must cede control to the buyers who would then need to gain the upper hand over the key 20-day SMA to start talking.
On the daily chart, The Relative Strength Index (RSI) for the NZD/USD pair continues within a negative trend territory. However, some signals of possible market correction exist as the RSI values hint at upward momentum. Simultaneously, the Moving Average Convergence Divergence (MACD) shows rising green bars, indicating buyers are gradually edging in against the sellers, lending positive momentum to the market.
NZD/USD daily chart
Moving on to the hourly chart, the RSI also persists in a negative trend, but the latest hour displays an upswing, carrying the indicator above the 50 mark which, paired with decreasing red bars on the MACD histogram, might suggest a short-term trend reversal or correction.
NZD/USD hourly chart
Assessing the overall landscape, the NZD/USD is in a definitive downtrend, underpinned by its position below the 20, 100, and 200-day Simple Moving Averages (SMAs). This situation suggests a prolonged bearish momentum as both short-term and long-term traders are selling the pair. Thursday's price movement raises another red flag as an attempted recovery by buyers has been rejected at the 20-day SMA at the 0.5960 level, suggesting a lack of bullish conviction and the potential for further downside. With these considerations, the outlook remains tilted in favor of sellers.
NZD/USD Overview Today last price 0.595 Today Daily Change 0.0015 Today Daily Change % 0.25 Today daily open 0.5935
Trends Daily SMA20 0.5961 Daily SMA50 0.6052 Daily SMA100 0.6117 Daily SMA200 0.605
Levels Previous Daily High 0.5958 Previous Daily Low 0.592 Previous Weekly High 0.5954 Previous Weekly Low 0.5851 Previous Monthly High 0.6218 Previous Monthly Low 0.5956 Daily Fibonacci 38.2% 0.5944 Daily Fibonacci 61.8% 0.5935 Daily Pivot Point S1 0.5917 Daily Pivot Point S2 0.5899 Daily Pivot Point S3 0.5879 Daily Pivot Point R1 0.5956 Daily Pivot Point R2 0.5976 Daily Pivot Point R3 0.5994
00:28 EUR/USD Price Analysis: Bulls are not out of the woods, despite reclaiming 1.0700
On Thursday, the Euro rose against the US Dollar after US economic data portrayed the economy as weaker than expected.
EUR/USD rises due to US GDP shortfall and elevated inflation data.Technical resistance near 50 and 200-day MAs at 1.0805/07; 100-DMA at 1.0848 next hurdle.Downside below 1.0694 could retest year's low at 1.0601, possibly extending to 1.0516.On Thursday, the Euro rose against the US Dollar after US economic data portrayed the economy as weaker than expected. At the same time, the inflation figure prompted investors to price out the Federal Reserve's rate cuts in 2024. At the time of writing, the EUR/USD trades at 1.0729, up by 0.29%.
EUR/USD Price Analysis: Technical outlook
From a technical standpoint, the EUR/USD remains bearishly biased, but in the short term, it could test the confluence of the 50 and 200-day moving averages (DMAs) at 1.0805/07. If buyers clear that stir resistance, buyers must crack the 100-DMA at 1.0848. Subsequent gains are seen above that level, with the 1.0900 mark up next.
On the flip side, if EUR/USD sellers drag the spot price below the February 14 low of 1.0694, that would pave the way toward the year-to-date (YTD) low of 1.0601, followed by the November 1, 2023, intermediate support at 1.0516.
EUR/USD Price Action – Daily ChartEUR/USD Overview Today last price 1.0729 Today Daily Change 0.0030 Today Daily Change % 0.28 Today daily open 1.0699
Trends Daily SMA20 1.0735 Daily SMA50 1.0808 Daily SMA100 1.0849 Daily SMA200 1.081
Levels Previous Daily High 1.0714 Previous Daily Low 1.0678 Previous Weekly High 1.069 Previous Weekly Low 1.0601 Previous Monthly High 1.0981 Previous Monthly Low 1.0768 Daily Fibonacci 38.2% 1.0692 Daily Fibonacci 61.8% 1.07 Daily Pivot Point S1 1.068 Daily Pivot Point S2 1.0661 Daily Pivot Point S3 1.0643 Daily Pivot Point R1 1.0716 Daily Pivot Point R2 1.0733 Daily Pivot Point R3 1.0752
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