Morning Market Review
EUR/USD
Today, during the Asian session, the EUR/USD pair is slightly falling, continuing to develop the “bearish” impulse formed yesterday. The negative dynamics was due to another wave of USD strengthening in response to the Fed Chairman Jerome Powell’s speech, which contributed to the growth of negative sentiment in the market. Powell spoke rather sharply about the prospects for the recovery of the US economy, noting that it would be "a long period of poor growth and a widespread drop in income." Also, the official directly appealed to Congress to take additional stimulation measures. Wednesday’s macroeconomic statistics faded into the background. The dynamics of industrial production in the EU in March decreased by 11.3% MoM, which was slightly better than market expectations of –12.1 MoM. Also, the production fell by 12.9% YoY, exceeding the forecast of –12.4% YoY.
GBP/USD
Today, during the Asian session, the GBP/USD pair maintains a moderate downward trend, renewing local lows of April 7. Now the instrument is trying to consolidate below 1.2200. Investors are focused on a large block of UK macroeconomic statistics, released on Wednesday. Many indicators were better than their extremely negative forecasts but it did not contribute to the growth of interest in the British currency. So, UK GDP for March fell by 5.8% MoM after a weakening of 0.2% MoM for February. Analysts had expected a much more significant drop – by 8% MoM. The British economy lost 2% QoQ with a forecast of –2.5% QoQ. Industrial production for March accelerated its decline from –0.1% MoM to –4.2% MoM with a forecast of a decrease of 5.6% MoM. The indicator fell by 8.2% YoY, while the market expected a decline of 9.3% YoY.
NZD/USD
Today, during the Asian session, the NZD/USD pair shows ambiguous dynamics. The instrument is trying to correct after an active decline yesterday when the New Zealand dollar was under pressure from the publication of the RBNZ protocols. As expected, the regulator kept the interest rate at the previous level of 0.25% but also reported a sharp increase in the volume of the quantitative easing program from 33B to 60B NZD. Also, the published protocols reflected the bank’s strong commitment to decrease interest rates to negative values if the situation requires. On Thursday, New Zealand will begin the process of phasing out the previously introduced quarantine restrictions, which should positively affect the dynamics of the labor market and industrial production.
USD/JPY
Today, during the Asian session, the USD/JPY pair is moderately declining, developing a “bearish” trend, which replaced the growth of Tuesday. Despite the fairly strong position of the American currency in the market, the yen looks quite promising in the current struggle for the title of shelter asset, which is partly due to the publication of disappointing US macroeconomic statistics and a speech by the head of the Fed Jerome Powell. On Thursday, investors are focused on the release of US Initial Jobless Claims for the week of May 8. Analysts expect growth of about 2.5 million, which is slightly lower than the 3.17 million recorded over the past period.
XAU/USD
Today, during the Asian session, gold prices are falling, testing the level of 1700 for a breakdown. At the same time, the instrument is near its weekly highs, which it keeps due to the growth of negative sentiment in the market. Yesterday's speech by Fed Chairman Jerome Powell intensified investor concerns regarding the prospects for a recovery in the US economy, although Powell rejected the idea of introducing negative interest rates again. Instead, the chairman of the regulator called on the US Congress to increase the volume of economic assistance packages, which currently reaches $3B.
EUR/USD
Today, during the Asian session, the EUR/USD pair is slightly falling, continuing to develop the “bearish” impulse formed yesterday. The negative dynamics was due to another wave of USD strengthening in response to the Fed Chairman Jerome Powell’s speech, which contributed to the growth of negative sentiment in the market. Powell spoke rather sharply about the prospects for the recovery of the US economy, noting that it would be "a long period of poor growth and a widespread drop in income." Also, the official directly appealed to Congress to take additional stimulation measures. Wednesday’s macroeconomic statistics faded into the background. The dynamics of industrial production in the EU in March decreased by 11.3% MoM, which was slightly better than market expectations of –12.1 MoM. Also, the production fell by 12.9% YoY, exceeding the forecast of –12.4% YoY.
GBP/USD
Today, during the Asian session, the GBP/USD pair maintains a moderate downward trend, renewing local lows of April 7. Now the instrument is trying to consolidate below 1.2200. Investors are focused on a large block of UK macroeconomic statistics, released on Wednesday. Many indicators were better than their extremely negative forecasts but it did not contribute to the growth of interest in the British currency. So, UK GDP for March fell by 5.8% MoM after a weakening of 0.2% MoM for February. Analysts had expected a much more significant drop – by 8% MoM. The British economy lost 2% QoQ with a forecast of –2.5% QoQ. Industrial production for March accelerated its decline from –0.1% MoM to –4.2% MoM with a forecast of a decrease of 5.6% MoM. The indicator fell by 8.2% YoY, while the market expected a decline of 9.3% YoY.
NZD/USD
Today, during the Asian session, the NZD/USD pair shows ambiguous dynamics. The instrument is trying to correct after an active decline yesterday when the New Zealand dollar was under pressure from the publication of the RBNZ protocols. As expected, the regulator kept the interest rate at the previous level of 0.25% but also reported a sharp increase in the volume of the quantitative easing program from 33B to 60B NZD. Also, the published protocols reflected the bank’s strong commitment to decrease interest rates to negative values if the situation requires. On Thursday, New Zealand will begin the process of phasing out the previously introduced quarantine restrictions, which should positively affect the dynamics of the labor market and industrial production.
USD/JPY
Today, during the Asian session, the USD/JPY pair is moderately declining, developing a “bearish” trend, which replaced the growth of Tuesday. Despite the fairly strong position of the American currency in the market, the yen looks quite promising in the current struggle for the title of shelter asset, which is partly due to the publication of disappointing US macroeconomic statistics and a speech by the head of the Fed Jerome Powell. On Thursday, investors are focused on the release of US Initial Jobless Claims for the week of May 8. Analysts expect growth of about 2.5 million, which is slightly lower than the 3.17 million recorded over the past period.
XAU/USD
Today, during the Asian session, gold prices are falling, testing the level of 1700 for a breakdown. At the same time, the instrument is near its weekly highs, which it keeps due to the growth of negative sentiment in the market. Yesterday's speech by Fed Chairman Jerome Powell intensified investor concerns regarding the prospects for a recovery in the US economy, although Powell rejected the idea of introducing negative interest rates again. Instead, the chairman of the regulator called on the US Congress to increase the volume of economic assistance packages, which currently reaches $3B.