Talking Points:
- Aussie Dollar Soars as Jobs Data Tops Forecasts, Denting RBA Rate Cut Bets
- US Dollar Looks to Fed Commentary for a Lifeline After Two Days of Losses
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The Australian Dollar outperformed in otherwise quiet overnight trade, rising as much as 1.1 percent on average against its leading counterparts. The move followed sharply better than expected set of labor market figures. The economy added 37,700 jobs in March, topping estimates for a meager 15,000 increase, while the unemployment rate unexpectedly dropped to a three-month low of 6.1 percent. The Aussie’s move higher tracked a parallel surge in front-end bond yields, suggesting traders interpreted the upbeat improvement on the employment front as reducing the scope for on-coming RBA interest rate cuts.
A relatively quiet European data docket will likely see investors looking ahead to US news-flow for direction cues. “Fed-speak”is in focus, with comments from Vice Chair Stanley Fischer and Atlanta Fed President Dennis Lockhart of particular note considering both are currently members of the FOMC rate-setting committee. Cleveland Fed President Loretta Mester and Boston Fed President Eric Rosengren are likewise due to speak.
Needless to say, the timing of the first post-QE rate hike is the central question on the minds of investors. Rhetoric pointing to the lingering possibility of a mid-year move, particularly from the typically dovish Mr Lockhart, may breathe new life into the US Dollar and send the currency higher after two days of losses. Alternatively, a more timid tone points to compound selling pressure facing the greenback.
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Asia Session
| GMT | CCY | EVENT | ACT | EXP | PREV |
|---|---|---|---|---|---|
| 22:00 | NZD | ANZ Job Advertisements (MoM) (MAR) | -0.8% | - | 0.7% |
| 22:30 | NZD | BusinessNZ Manufacturing PMI (MAR) | 54.5 | - | 56.1 |
| 23:01 | GBP | RICS House Price Balance (MAR) | 21% | 15% | 14% |
| 1:00 | AUD | Consumer Inflation Expectation (APR) | 3.4% | - | 3.2% |
| 1:30 | AUD | New Motor Vehicle Sales (MoM) (MAR) | 0.5% | - | 2.7% |
| 1:30 | AUD | New Motor Vehicle Sales (YoY) (MAR) | 4.4% | - | 4.0% |
| 1:30 | AUD | Employment Change (MAR) | 37.7K | 15.0K | 42.0K |
| 1:30 | AUD | Unemployment Rate (MAR) | 6.1% | 6.3% | 6.3% |
| 1:30 | AUD | Full Time Employment Change (MAR) | 31.5K | - | 41.9K |
| 1:30 | AUD | Part Time Employment Change (MAR) | 6.1K | - | 0.1K |
| 1:30 | AUD | Participation Rate (MAR) | 64.8% | 64.6% | 64.6% |
| 1:30 | AUD | RBA FX Transactions Government (MAR) | -1299M | - | -434M |
| 1:30 | AUD | RBA FX Transactions Market (MAR) | 1355M | - | 409M |
| 1:30 | AUD | RBA FX Transactions Other (MAR) | 55M | - | 33M |
| 2:00 | CNY | Foreign Direct Investment (YoY) (MAR) | 2.2% | 1.3% | 0.9% |
| 3:00 | NZD | Non Resident Bond Holdings (MAR) | 66.5% | - | 65.7% |
| 4:00 | JPY | Tokyo Condominium Sales (YoY) (MAR) | -4.0% | - | -2.0% |
European Session
| GMT | CCY | EVENT | EXP/ACT | PREV | IMPACT |
|---|---|---|---|---|---|
| 6:00 | EUR | EU27 New Car Registrations (MAR) | - | 7.3% | Low |
| 6:00 | JPY | Machine Tool Orders (YoY) (MAR F) | - | 14.6% | Low |
| 7:15 | CHF | Producer & Import Prices (MoM) (MAR) | 0.0% | -1.4% | Medium |
| 7:15 | CHF | Producer & Import Prices (YoY) (MAR) | -3.7% | -3.6% | Medium |
| 8:00 | EUR | ECB Survey of Professional Forecasters | Medium | ||
| 8:00 | EUR | Italy Trade Balance Total (FEB) | - | 219M | Low |
| 8:00 | EUR | Italy Trade Balance EU (FEB) | - | 452M | Low |
Critical Levels
| CCY | Supp 3 | Supp 2 | Supp 1 | Pivot Point | Res 1 | Res 2 | Res 3 |
|---|---|---|---|---|---|---|---|
| EURUSD | 1.0390 | 1.0521 | 1.0603 | 1.0652 | 1.0734 | 1.0783 | 1.0914 |
| GBPUSD | 1.4495 | 1.4647 | 1.4744 | 1.4799 | 1.4896 | 1.4951 | 1.5103 |
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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