The #IronFX Midday Commentary by Marshall Gittler: The #dollar continued moving higher against the most of the other #G10 currencies during the European morning Wednesday. It was lower only against NOK, while it remained near its opening levels against #JPY and #CAD. The losers were #NZD, #GBP, #AUD, #SEK, #EUR and #CHF. The only important releases during the morning were Germany’s #unemployment rate for May and Eurozone’s money supply data for April. The German unemployment rate remained unchanged at 6.7% as expected but the number of unemployed persons unexpectedly rose by 24k, vs estimates of a 15k decline. #Eurozone’s M3 money supply slowed to +0.8% yoy in April, missing market estimates of +1.1% yoy and driving the 3-month moving average down to +1.0% yoy from +1.2% yoy. The bank lending data showed some improvement, but total credit creation continued to fall at the same record pace as in March. This shows that the ECB’s loose policy is not percolating through to the real economy and Bank officials will have to take further steps to ensure that their supply of funds to the banking system is transmitted to business and households. The reports keep the pressure on the #ECB to ease policy next week. Nonetheless, they didn’t have an immediate impact on the common currency today, as the euro remained well supported by the 1.3612 barrier. This shows that, as we said on Tuesday, the ECB’s likely moves are already largely discounted in the market. The kiwi extended its overnight declines after the #ANZ business confidence fell in May. NZD/USD fell sharply, breaking the strong support zone of 0.8520. I would now expect the bears to go for the 0.8450 support hurdle. The South African Rand was the main loser among the EM #currencies we track. It continued its decline from yesterday, when it was announced that the nation’s #GDP contracted in Q1 on the back of the strike in the platinum mining industry that started in January. For more please visit: ironfx/en/research-and-analysis/market-analysis/intraday-comment
Posted on: Wed, 28 May 2014 10:47:09 +0000
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