22 May 2015
BOJ drives yen higher, German Ifo, Central Bankers’ speeches awaited
FXStreet (Mumbai) - The Bank of Japan (BOJ) monetary policy decision remained the major highlight amid a rather calmer Asian session. The BOJ kept the policy steady, although revised its economic assessment to the upside which boosted the yen versus the buck. While the Antipodeans extended its upward trajectory on broad based US dollar weakness.
Key headlines in Asia
BoJ keeps policy steady, upgrades economic view
China CB Leading Economic Index up to 1.1 in April from previous 0.2
Nikkei remains in red post BOJ status-quo
Dominating themes in Asia - centered on JPY, AUD, NZD
The dollar-yen pair extended its declines and dropped to lows near 120.75 in reaction to the unchanged policy decision by Japanese central bank as economic outlook improves on a pickup in GDP figures. While Japanese equities trades more or less muted post BOJ announcement.
The Kiwi remains the strongest amongst the G10 currencies with a fresh bid wave driving the pair higher towards 0.74 stop territory. AUD/USD also extended gains tracking its NZ counterpart’s upward moves. While the US dollar remains weak against its major competitors following Thursday’s downbeat US macro data including weekly jobless claims, manufacturing PMIs and existing home sales.
Heading into Europe - centered on EUR, GBP
A fairly light European trading calendar, with Final GDP and Ifo Business Climate readings from Germany are expected to keep traders busy.
A closely watched survey, the Ifo Business Climate Index, is expected to edge down to 108.3 in May, from the 108.6 booked in the fourth month of the year. The Current Assessment sub-index is also seen as edging lower to 113.5, after posting a figure of 113.9 a month ago. The Ifo Expectations Index - indicating firms' projections for the next six months - is projected to slip to 103.1, from 103.5 in April.
Final German GDP growth figures for Q1 are expected to confirm preliminary data of 0.3% growth, q-o-q, and 1.1% on annual basis.
While speeches from the Central Bankers during the European session will be also closely watched. ECB President Mario Draghi is due to speak at the ECB Forum on Central Banking titled "Inflation and Unemployment in Europe," in Portugal, followed by BOE Governor Carney speech.
Later in the North American session, US CPI data is likely to dominate, while a series of Canada’s macro data flow will also be lined for release. However, Fed Chair Yellen’s speech is likely to remain the key focus today.
EUR/USD Technicals
Chris Capre, Founder at 2ndSkies, notes, “Posting another day of meek bounces, the Euro is in a corrective phase on the range lows. I'm suspecting the 1.1270/88 resistance level should hold on a pullback so am looking to get short. This will be my first pullback level while the 1.1430/50 would be my second level to get short. Only a daily close above the latter negates my range bias ST. Closing below the range support puts 1.10 under attack."
Key headlines in Asia
BoJ keeps policy steady, upgrades economic view
China CB Leading Economic Index up to 1.1 in April from previous 0.2
Nikkei remains in red post BOJ status-quo
Dominating themes in Asia - centered on JPY, AUD, NZD
The dollar-yen pair extended its declines and dropped to lows near 120.75 in reaction to the unchanged policy decision by Japanese central bank as economic outlook improves on a pickup in GDP figures. While Japanese equities trades more or less muted post BOJ announcement.
The Kiwi remains the strongest amongst the G10 currencies with a fresh bid wave driving the pair higher towards 0.74 stop territory. AUD/USD also extended gains tracking its NZ counterpart’s upward moves. While the US dollar remains weak against its major competitors following Thursday’s downbeat US macro data including weekly jobless claims, manufacturing PMIs and existing home sales.
Heading into Europe - centered on EUR, GBP
A fairly light European trading calendar, with Final GDP and Ifo Business Climate readings from Germany are expected to keep traders busy.
A closely watched survey, the Ifo Business Climate Index, is expected to edge down to 108.3 in May, from the 108.6 booked in the fourth month of the year. The Current Assessment sub-index is also seen as edging lower to 113.5, after posting a figure of 113.9 a month ago. The Ifo Expectations Index - indicating firms' projections for the next six months - is projected to slip to 103.1, from 103.5 in April.
Final German GDP growth figures for Q1 are expected to confirm preliminary data of 0.3% growth, q-o-q, and 1.1% on annual basis.
While speeches from the Central Bankers during the European session will be also closely watched. ECB President Mario Draghi is due to speak at the ECB Forum on Central Banking titled "Inflation and Unemployment in Europe," in Portugal, followed by BOE Governor Carney speech.
Later in the North American session, US CPI data is likely to dominate, while a series of Canada’s macro data flow will also be lined for release. However, Fed Chair Yellen’s speech is likely to remain the key focus today.
EUR/USD Technicals
Chris Capre, Founder at 2ndSkies, notes, “Posting another day of meek bounces, the Euro is in a corrective phase on the range lows. I'm suspecting the 1.1270/88 resistance level should hold on a pullback so am looking to get short. This will be my first pullback level while the 1.1430/50 would be my second level to get short. Only a daily close above the latter negates my range bias ST. Closing below the range support puts 1.10 under attack."