Euro steady after mixed Eurozone data, US CPI next

Kenny Fisher MarketPulse

The euro is drifting on Wednesday. EUR/USD is down 0.04%, trading at 1.0825 in the European session at the time of writing.

Eurozone GDP rises, industrial production eases

The eurozone economy rebounded in the first quarter. GDP rose 0.3% q/q, up from -0.1% in the first quarter. Annually, GDP grew 0.4%, up from 0.1% in the first quarter.

Industrial production rose 0.6% m/m in March, after a revised 1% gain in February and just above the market estimate of 0.6%. Annually, industrial production declined by 1%, following a revised -6.3% in February and above the market estimate of -1.2%. Recent releases point to improvement in the eurozone economy, which is seeing stronger demand. As well, an improvement in China’s economy has increased the demand for eurozone exports.

US inflation expected to ease

All eyes are on today’s US CPI report, which could shake up the US dollar. Headline CPI is expected to drop to 3.4% y/y in April, down from 3.5% in March. Monthly, headline CPI is forecast to remain unchanged at 0.4%. Core CPI, which is a better indicator of inflation trends, is expected to ease from 3.8% y/y to 3.6%, and monthly from 0.4% to 0.3%.

Federal Chair Powell said on Tuesday that inflation is falling more slowly than expected and the Fed will remain patient and “let restrictive policy do its work”. Powell’s comments were likely aimed at dampening any market exuberance if CPI is lower than the estimate.

The money markets widely expect the Fed to hold rates at the June meeting, with a rate cut priced at 32% in July and 67% in September, according to the CME FedWatch tool. In January, the markets had priced in six rate cuts, but a strong US economy and rising inflation has slashed rate cut expectations.

EUR/USD technical

EUR/USD is putting pressure on resistance at 1.0842. Above, there is resistance at 1.0863.
There is support at 1.0804 and 1.0783.

Author

Kenny Fisher

MarketPulse

A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities.

EUR/USD off highs, back to around 1.1900

EUR/USD keeps its strong bid bias in place despite recedeing to the 1.1900 zone following earlier peaks north of 1.1900 the figure on Monday. The US Dollar remains under pressure, as traders stay on the sidelines ahead of Wednesday’s key January jobs report, leaving the pair room to extend its upward trend for now.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold picks up pace, retargets $5,100

Gold gathers fresh steam, challenging daily highs en route to the $5,100 mark per troy ounce in the latter part of Monday’s session. The precious metal finds support from fresh signs of continued buying by the PBoC, while expectations that the Fed could lean more dovish also collaborate with the uptick.

Crypto Today: Bitcoin steadies around $70,000, Ethereum and XRP remain under pressure

Bitcoin hovers around $70,000, up near 15% from last week's low of $60,000 despite low retail demand. Ethereum delicately holds $2,000 support as weak technicals weigh amid declining futures Open Interest. XRP seeks support above $1.40 after facing rejection at $1.54 during the previous week's sharp rebound.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Ripple exposed to volatility amid low retail interest, modest fund inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.