14 Jul 2015
Aussie strongest in Asia, UK inflation report, BOE Carney’s testimony – Key
FXStreet (Mumbai) - The Australian dollar emerged the best performer across the FX space in Asia, riding higher on improved June businesses confidence survey. While USD/JPY traded dead flat near 123.50, consolidating previous heavy gains. Kiwi remained capped below 0.67 handle, underperforming Asian currencies.
Key headlines in Asia
Australia's NAB June business survey improves
Asia rallies on Greek deal frenzy, Australian ASX leads +1.6%
Complex bridging loan before Greek parliamentary outcome
Iran nuclear talks: Official joint statement in a few hours
Dominating themes in Asia - centered on JPY, AUD, NZD
A quiet Asian session, with only Australia’s NAB Business confidence survey published which revealed that Australian businesses continued to experience better working conditions in June providing the much-needed impetus to the AUD/USD pair. However, the Kiwi failed to benefit from its OZ counterpart’s strength and remains slightly offered below 0.6700 levels as divergent monetary policy outlooks between New Zealand and the US keeps the NZD undermined.
Among the majors, the dollar-yen pair trades listless around the crucial 123.50 levels as USD bulls took a pause in its four-day rally as traders now await a host of US macro releases later this week while Greece headlines will also be eyed in the session ahead. While EUR/USD wavers above key 1.10 handle, bouncing-off a brief dip below that level. The European currency remain on a cautious mode awaiting Wednesday’s Greek parliament vote on the reforms proposal while Euro zone ministers prepare options of bridge financing on war-footing.
Most Asian markets are trading in green, with China stocks bucking the trend and reversed previous gains. The Shanghai composite index now trades -0.32% lower at 3957. The Nikkei 225 in Tokyo advances 1.61%, while Australian benchmark the ASX 200 trades 2% higher. While South Korea’s Kospi trades +0.18%.
Heading into Europe - centered on EUR, GBP
We have a busy European session ahead in terms of economic news releases, with the day kicking-off with German final CPI data. Germany will release its final inflation data for June, with CPI seen as declining 0.1% on a monthly basis, while growing 0.3% annually in June, confirming preliminary figures.
Next, the ZEW will release its Economic Sentiment Index for the next six months for Germany, as well as the Current Situation Index, reflecting institutional investors' opinions of the current situation. Economic sentiment is seen heading down to 30.5 in July from 31.5 measured in June, while the Current Situation Index is also expected to decline to 60.5 from 62.9 in the previous month.
The UK will also release inflation data. CPI in June is seen as growing 0.1%, lower than the 0.2% reported a month ago, while the annual CPI is predicted to add 0.1%, the same figure as reported in May.
Industrial production in the euro zone is seen as advancing 0.2% m/m in May, following a 0.1% gain reported in April, while growing 1.9% when measured annually, compared to an 0.8% gain recorded in April.
Moreover, the key event will be the UK’s Inflation Report Hearings followed by Bank of England’s (BOE) Governor Carney’s testimony on the Financial Stability Report before the Treasury Select Committee, in London.
Later in the North American session, a set of retail sales figures from the US will be reported along with 2-tier data in import prices and business inventories data.
EUR/USD Technicals
Valeria Bednarik, Chief Analyst at FXStreet explains, “Technically the 1 hour (EUR/USD) chart favors additional declines, as the price has extended below its moving averages, whilst the technical indicators maintain their bearish slopes, despite being in oversold territory. In the 4 hours chart, the bearish tone is also present, albeit lacking momentum, as the technical indicators stand flat below their mid-lines. Considering the wide intraday ranges seen lately, the price needs now to extend below the 1.0955 region to be able to extend its decline towards the 1.0820 region, the next strong midterm support.”
Key headlines in Asia
Australia's NAB June business survey improves
Asia rallies on Greek deal frenzy, Australian ASX leads +1.6%
Complex bridging loan before Greek parliamentary outcome
Iran nuclear talks: Official joint statement in a few hours
Dominating themes in Asia - centered on JPY, AUD, NZD
A quiet Asian session, with only Australia’s NAB Business confidence survey published which revealed that Australian businesses continued to experience better working conditions in June providing the much-needed impetus to the AUD/USD pair. However, the Kiwi failed to benefit from its OZ counterpart’s strength and remains slightly offered below 0.6700 levels as divergent monetary policy outlooks between New Zealand and the US keeps the NZD undermined.
Among the majors, the dollar-yen pair trades listless around the crucial 123.50 levels as USD bulls took a pause in its four-day rally as traders now await a host of US macro releases later this week while Greece headlines will also be eyed in the session ahead. While EUR/USD wavers above key 1.10 handle, bouncing-off a brief dip below that level. The European currency remain on a cautious mode awaiting Wednesday’s Greek parliament vote on the reforms proposal while Euro zone ministers prepare options of bridge financing on war-footing.
Most Asian markets are trading in green, with China stocks bucking the trend and reversed previous gains. The Shanghai composite index now trades -0.32% lower at 3957. The Nikkei 225 in Tokyo advances 1.61%, while Australian benchmark the ASX 200 trades 2% higher. While South Korea’s Kospi trades +0.18%.
Heading into Europe - centered on EUR, GBP
We have a busy European session ahead in terms of economic news releases, with the day kicking-off with German final CPI data. Germany will release its final inflation data for June, with CPI seen as declining 0.1% on a monthly basis, while growing 0.3% annually in June, confirming preliminary figures.
Next, the ZEW will release its Economic Sentiment Index for the next six months for Germany, as well as the Current Situation Index, reflecting institutional investors' opinions of the current situation. Economic sentiment is seen heading down to 30.5 in July from 31.5 measured in June, while the Current Situation Index is also expected to decline to 60.5 from 62.9 in the previous month.
The UK will also release inflation data. CPI in June is seen as growing 0.1%, lower than the 0.2% reported a month ago, while the annual CPI is predicted to add 0.1%, the same figure as reported in May.
Industrial production in the euro zone is seen as advancing 0.2% m/m in May, following a 0.1% gain reported in April, while growing 1.9% when measured annually, compared to an 0.8% gain recorded in April.
Moreover, the key event will be the UK’s Inflation Report Hearings followed by Bank of England’s (BOE) Governor Carney’s testimony on the Financial Stability Report before the Treasury Select Committee, in London.
Later in the North American session, a set of retail sales figures from the US will be reported along with 2-tier data in import prices and business inventories data.
EUR/USD Technicals
Valeria Bednarik, Chief Analyst at FXStreet explains, “Technically the 1 hour (EUR/USD) chart favors additional declines, as the price has extended below its moving averages, whilst the technical indicators maintain their bearish slopes, despite being in oversold territory. In the 4 hours chart, the bearish tone is also present, albeit lacking momentum, as the technical indicators stand flat below their mid-lines. Considering the wide intraday ranges seen lately, the price needs now to extend below the 1.0955 region to be able to extend its decline towards the 1.0820 region, the next strong midterm support.”