Market Review - 15/05/2013 23:00GMT
Euro tumbles on weak eurozone GDP data
The single currency tumbled against the dollar on Wednesday after GDP data from Germany and eurozone came in weaker-than-expected.
On the data front, German GDP in Q1 came in at -0.1% Q/Q n -1.4% y/y, vs the forecast 0.3% Q/Q. Euro zone GDP in Q1 came in at -0.2% Q/Q n -1.0% y/y, worse than the expectation of -0.2% n -0.9% respectively.
Although the single currency retreated to 1.2921 in early Asian morning, price rebounded to session high at 1.2943 ahead of European open. Euro met renewed selling pressure there and fell sharply to 1.2888 after the release of weaker-than-expected Germany GDP data. Despite a brief rebound to 1.2917, price fell again after eurozone GDP came in lower than forecast, eventually dropping to an intra-day low at 1.2843 at New York open.
Later, euro pared intra-day losses and recovered to 1.2890 on dollar's broad-based retreat after data showed producer prices dropped by the largest amount in 3 years, however, price retreated again to 1.2847 at New York midday before rebounding to 1.2888 in U.S. afternoon.
U.S. Empire manufacturing index in May came in at -1.43, worse than the expectation of 4.00; U.S. PPI in April is reported -0.6% m/m n 0.8% y/y, vs the forecast of -0.3% n 0.8% respectively.
Versus the Japanese yen, the greenback traded with a firm undertone in Asia and rose above Tuesday's 102.44 high at European open. Price continued to ratchet higher and hit a fresh 4-1/2 year high at 102.77 in European morning. However, dollar pared intra-day gains and fell briefly but sharply to intra-day low at 101.85 in New York morning on dollar's broad-based weakness. Despite a recovery to 102.61 at New York midday, renewed selling interest capped the pair's upside and pushed price lower in New York afternoon.
Although the British pound traded sideways in Asia and dropped briefly to 1.5192 in early European morning, price rebounded to an intra-day high at 1.5273 in European morning after the Bank of England upgraded its estimate of the U.K. economy and the Bank of England governor Mervyn King said a recovery was now 'in sight'. However, cable pared intra-day gains and fell to session low at 1.5173 at New York open before staging a strong recovery to 1.5268 in New York morning on dollar's weakness.
BoE's King said 'today is the first time I have been able to give a brighter economic outlook since financial crisis; but this is no time to be complacent, must press on to ensure a recovery; U.K. economy still faces challenge of substantial rebalancing; this has not been a typical recession, will not be typical recovery.'
Data to be released on Thursday :
New Zealand business PMI, Japan GDP, industrial production, capacity utilisation, Italy trade balance, EU CPI, trade balance, U.S. CPI, jobless claims, housing starts, building permits and Philadelphia fed survey.
Euro tumbles on weak eurozone GDP data
The single currency tumbled against the dollar on Wednesday after GDP data from Germany and eurozone came in weaker-than-expected.
On the data front, German GDP in Q1 came in at -0.1% Q/Q n -1.4% y/y, vs the forecast 0.3% Q/Q. Euro zone GDP in Q1 came in at -0.2% Q/Q n -1.0% y/y, worse than the expectation of -0.2% n -0.9% respectively.
Although the single currency retreated to 1.2921 in early Asian morning, price rebounded to session high at 1.2943 ahead of European open. Euro met renewed selling pressure there and fell sharply to 1.2888 after the release of weaker-than-expected Germany GDP data. Despite a brief rebound to 1.2917, price fell again after eurozone GDP came in lower than forecast, eventually dropping to an intra-day low at 1.2843 at New York open.
Later, euro pared intra-day losses and recovered to 1.2890 on dollar's broad-based retreat after data showed producer prices dropped by the largest amount in 3 years, however, price retreated again to 1.2847 at New York midday before rebounding to 1.2888 in U.S. afternoon.
U.S. Empire manufacturing index in May came in at -1.43, worse than the expectation of 4.00; U.S. PPI in April is reported -0.6% m/m n 0.8% y/y, vs the forecast of -0.3% n 0.8% respectively.
Versus the Japanese yen, the greenback traded with a firm undertone in Asia and rose above Tuesday's 102.44 high at European open. Price continued to ratchet higher and hit a fresh 4-1/2 year high at 102.77 in European morning. However, dollar pared intra-day gains and fell briefly but sharply to intra-day low at 101.85 in New York morning on dollar's broad-based weakness. Despite a recovery to 102.61 at New York midday, renewed selling interest capped the pair's upside and pushed price lower in New York afternoon.
Although the British pound traded sideways in Asia and dropped briefly to 1.5192 in early European morning, price rebounded to an intra-day high at 1.5273 in European morning after the Bank of England upgraded its estimate of the U.K. economy and the Bank of England governor Mervyn King said a recovery was now 'in sight'. However, cable pared intra-day gains and fell to session low at 1.5173 at New York open before staging a strong recovery to 1.5268 in New York morning on dollar's weakness.
BoE's King said 'today is the first time I have been able to give a brighter economic outlook since financial crisis; but this is no time to be complacent, must press on to ensure a recovery; U.K. economy still faces challenge of substantial rebalancing; this has not been a typical recession, will not be typical recovery.'
Data to be released on Thursday :
New Zealand business PMI, Japan GDP, industrial production, capacity utilisation, Italy trade balance, EU CPI, trade balance, U.S. CPI, jobless claims, housing starts, building permits and Philadelphia fed survey.