China shares hit one-year high
Speculation that a trade deal was “close” helped Wall Street rally yesterday and that trend extended in to today’s Asian session, with little on the data front to disrupt the bullish sentiment. Despite the fact that the details of the proposed deal appear to be very one-sided—with the U.S. supposedly being allowed to re-impose tariffs immediately if China does not comply with the terms of the deal, but China cannot do the same, nor can it take the U.S. to the World Trade Organization—China shares pushed higher for a second straight day to touch the highest since March 13 last year.
Source, all charts: OANDA fxTrade
The index appears to be heading toward the 78.6% Fibonacci retracement of the January 2018 to January 2019 drop at 13,908.
USD/JPY grapples with key moving average
USD/JPY was marginally lower on the day as the FX pair hovers around the 200-day moving average at 111.49. The moving average has been tested daily this week but we have yet to see a sustained close above it. Speaking before Parliament, Bank of Japan Governor Kuroda reiterated that the central bank needs to continue easing persistently to support the economy and acknowledged that it would take some time to reach price targets.
German factory orders to stay weak
German factory orders likely contracted for a ninth straight month on February. Surveys suggest orders fell 5.4% y/y following a 3.9% decline in January. The minutes of the last ECB meeting are due today, with focus squarely on discussions about the meager growth forecasts. There are more U.S. jobs data releases today ahead of tomorrow’s nonfarm payrolls report. Challenger job cuts for March and the weekly jobless claims are scheduled. Speeches from the Fed’s Mester and Williams complete the session.