The unemployment rate in the UK remained unchanged in March at 4.7%, which was in line with forecast.The numbers of employees in the UK rose by 25500 in March after a decline of 6,100 in the previous month.Analysts expected a decline of 3.000.Average hourly earnings,including bonuses, in the UK have risen by 2.3%, while the predicted growth of 2.2%. GBP / JPY climbed to 136.82.
Bank lending rose in March to 3.0% from 2.8% in the previous month. It had expected to rise to 2.9%. Index price of corporate goods in Japan increased in March at 1.4% to 1.0% of the previous month, while the predicted growth to 1.3%.
Import prices in the US fell in March by 0.2% in line with forecasts after rising 0.4% in February.Export prices have increased by 0.2%,after the growth of 0.4% in the previous month, and was expected to increase by 0.1%.
The index of wholesale prices in Germany remained unchanged in March after rising 0.5% in the previous month while analysts predicted growth of 0.4%. Currency pair EUR/USD rose to 1.06032.
The price of gold is on the rise during European trading. Last comments of US President Donald Trump about the overvaluation of the US currency had a positive impact on the price of the precious metal.Political risks in the world pushed higher price of gold at the highest level in five months. The price of gold has increased by 0.88%.
US stocks have fallen because they are still under pressure due to geopolitical tensions.President Donald Trump said that the dollar is strong and he would like to keep interest rates low.Investors are still concerned about the tensions between the US and Russia,Syria and North Korea.
Tramp said in the Wall Street Journal that the dollar is strong and a lot that should weaken in order to assist the United States.This is a day after the end of the meeting with the President of China, where it was decided that instead of Yuan declare too low.
The better option for the US economy is the dollar lower.It expected in the next 12 months that the dollar will fall by almost all currencies. If in France Lepen wins,the euro will join the dollar decline over the next 12 months.It is already at a very low level.
Monday 17th April
It will be published Monetary Policy Meeting Minutes for Australian dollar. Its Bank Holiday in Europe.
Tuesday 18th April
It will be released Building Permits for the US dollar and GDT Price Index for New Zealand dollar.
Wednesday 19th April
It will be published Crude Oil Inventories for the US dollar and Consumer Price Index for New Zealand dollar.
Thursday 20th April
It will be released Unemployment Claims,Philly Fed Manufacturing Index for the US dollar.Bank of England Carney will be spoken.The US Treasury Secretary Mnuchin will be spoken.
Friday 21st April
It will be published Retail Sales for pound and Consumer Price Index for Canadian dollar.
My trading tips
I’m neutral on EUR/USD this week.
I’m neutral on USD/JPY this week.
I’m neutral on GBP/USD this week.
I’m neutral on AUD/USD this week.
I’m neutral on USD/CAD this week.
Trump said the the US dollar is too strong. In the euro zone election in France could push the euro under pressure.
The US economy is strong and the market sentiment supported the US dollar. Geopolitical tension in Korea could support the yen.
The US dollar is under pressure while Brexit could push pound to the lowest level this week.
Monetary divergence supported the US dollar but the US currency is under pressure this week.
The Fed sent hawkish message. It is expected to be risen the rate by the Fed in June.
Global markets will this week be focused on economic data from the US, euro area, Japan, Germany and New Zealand.
On Tuesday it will be released in the US March data on the number of issued building permits and new houses. Analysts predict that number of building permits issued rose to 1.245 million units from 1216 in the previous month. The number of new homes is expected to fall to 1.264 million units from 1.288 million in February. On Thursday will be published weekly data on the number of unemployed. It is expected to rise to 241000 from 234000 in the previous week. On Friday will be published data on sales of existing homes in March. Economists predict growth to 5.61 million units from 5.48 million in the previous month.
On Wednesday in the euro zone will be published data on consumer price inflation in March.It is predicted to will to remain unchanged, at 1.5%, as in the previous month, while the core inflation is also projected to remain unchanged at 0.7%. On Friday will be released a preliminary report on the index of activity in the manufacturing sector in April. Projected decline in the index to 56.0 points from 56.2 in the previous month.
On Thursday in New Zealand will be published data on consumer price inflation in the first quarter.It ss projected to rise to 0.8% from 0.4% in the last quarter.
On Thursday inJapan will be published the data on trade balance. Analysts expect a fall in March to 576 billion yen from 813 billion in February. For export is forecasted to increase by 6.7%, after the growth of 11.3% in the previous month, and the import is expected to rise to 10.4% after growth at 1.2% in February. On Friday will be published data on manufacturing index in April is forecast to rise to 52.5 points from 52.4 in March.
On Thursday in Germany will be published data on producer price inflation in March. It expected to grow by 0.1% after rising 0.2% in February. On Friday will be released a preliminary report on the index of activity in the manufacturing sector in April. Economists expected a drop to 58.0 points from 58.3 in March.
Geopolitical tensions are still present and have a negative impact on global markets.US President Donald Trump said that the North Korea problem to be solved, but more and more speculation that Pyongyang implement the sixth in a row nuclear test. In Afghanistan, the US threw the most powerful non-nuclear bomb, the US, which is aimed at North Korea shows the strength of US military forces.
Markets are nervous about geopolitical tensions. North Korea has announced harsh countermeasures to any military move that could take place after the US Navy has sent an aircraft carrier and fleet in the waters of the Korean Peninsula.
The first round of French presidential elections will be held April 23 2017.In the event that none of the candidates secure a majority in the first round will go to the second round of presidential elections scheduled on 7th May 2017. April 23 marks exactly 10 months after the British voted for the exit from the EU. Also,it's been almost five months since the victory of Donald Trump's presidential election in the US. All eyes are currently directed towards France as investors try to predict whether the next threat to the common European market will be the French out of the EU, called "Frexit".
The candidate of the French extreme-right, Marine Le Pen has promised a referendum the citizens of France to decide whether they want their country out of the EU.It is received in place of the candidate and the individual forecasts show that this announcement secure enough votes this candidate in the second round elections.However,its main rival Emanuel Makron by political conviction is centralist and current surveys listed as the winner of the second round of presidential elections.Financial markets treated victory Marine Le Pen as negative news, while a victory of Emanuel Makron of the market interpreted as positive news.
Monday 24th April
It will be published German Ifo Buisness Climate for euro. Its Bank Holiday in Australia, New Zealand and Italy.
Tuesday 25th April
It will be released Consumer Confidence for the US dollar, Consumer Price Index and Trimmed Mean Consumer Price Index for Australian dollar.
Wednesday 26th April
It will be published Core Retail Sales for Canadian dollar, Crude Oil Inventories for the US dollar,Monetary Policy Statement for yen. RBA Governor Low will be spoken.
Thursday 27th April
It will be released BOJ Policy Rate for yen, Minumum Bid Rate for euro, Core Durable Good Orders and Unemployment Claims for the US dollar.
Friday 28th April
It will be published Prelim GDP for pound, GDP for Canadian dolla and Advance GDP for the US dollar.
My trading tips
I’m call option on EUR/USD this week.
I’m neutral on USD/JPY this week.
I’m call option on GBP/USD this week.
I’m neutral on AUD/USD this week.
I’m call option on USD/CAD this week.
It depends on the French elections.Macron leads and he goes in the second round. It will push the euro higher this week.If Le Pen wins we could see parity.
The US economy is stronger. The markets aren’t impressed with Trump’s first 100 days in office. The Japanese economy has shown improvement. US protectionism remains a serious risk and Trump is likely to react if the Japanese weakens.
The Fed will raise rate in June but Trump pushed lower the US dollar.
Stronger global demand has boosted demand for Australian products. US protectionism remains a serious risk.
The US economy is stronger than Canadian. Lower oil price could push higher the currency pair this week.
Global markets will this week be focused on a series of economic reports of the European Central Bank and the Bank of Japan.
The Bank of Japan will hold a monthly meeting on Wednesday. It is expected to keep the interest rate at minus 0.10%. It is anticipated that the central bank will keep yields on 10-year government bonds, as well as the annual program of buying bonds to about 80 trillion yen, because waiting for more evidence of a modest economic recovery.The Governor of the BOJ, Haruhiko Kuroda, will hold a press conference after the meeting. He recently reiterated that the central bank decided to maintain the monetary stimulus until inflation is stable above the 2% target.
The European Central Bank will hold a meeting on Thursday. It will publish the latest decision in regard to interest rates. Analysts didn’t expect a change in monetary policy,despite recent signs of growth and a jump in inflation. The market focus will be on the speech of the President of the ECB, Mario Draghi, at a press conference to be held after the meeting. In the euro zone will be published on Friday,preliminary data on inflation in April.It is predicted that the report will show consumer prices by 1.8%, after rising 1.5% in March. From basic price is expected to increase by 1%, after rising 0.7% in the previous month. Spain, France, Italy and Germany will also publish a report on consumer price inflation.
On Friday in US will announce preliminary data on economic growth in the first quarter.It expected to grow at an annual rate of 1.1%, after an increase of 2.1% in the fourth quarter. In addition to the report on GDP, this week will be published data on consumer confidence, new home sales and durable goods orders. News from Washington will also be in focus due to health care reform and reducing taxes.US President Donald Trump promised a big announcement tax reform on Friday.