Tag Archives: north

EUR/USD: Drop in the US-DE 10-yr yield spread likely eased pressure on EUR ahead of key data releases

EUR/USD's drop below 1.12 seen yesterday was short-lived, possibly due to a tightening of US-German yield spreads in the US session. The US-China trade optimism could keep the EUR better bid in Europe. The recovery rally, however, would be erased if the Eurozone services PMI and retail sales, due for release today, disappoint expectations. EUR/USD is currently attempting a recovery rally, having defended the psychological support of 1.12 yesterday on a closing basis. The shared currency fell to 1.1184 on Tuesday, the lowest level since March 7, on growing US-Eurozone macro data divergence. The decline to 3.5-week lows below 1.12, however, was short-lived, as the spread between the 10-year US and German government bond yields eased by three basis points to 253 basis points following the release of the dismal US durable goods orders data during the North American trading hours. With the quick recovery, the bullish divergence of the 4-hour chart relative strength index (RSI) has gained credence. Add to that the optimism generated by the Financial Times report stating that the top US and Chinese officials have resolved most of the issues blocking the long-awaited trade deal and the EUR appears on track for a stronger corrective bounce to 1.1250. The oversold bounce will likely gather pace if the German and aggregate Eurozone services PMI numbers for March print above estimates, alleviating concerns of deeper economic slowdown.  Post-PMIs, the focus would shift to Eurozone retail sales, due for release at 09:00 GMT. The data is expected to show the consumer spending rose just 0.2 percent month-on-month in February, having risen by 1.3 percent in the preceding month. An above-forecast reading will likely strengthen the case for a corrective rally in the EUR. Technical Levels  

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EUR/USD: Drop in the US-DE 10-yr yield spread likely eased pressure on EUR ahead of key data releases

UK Tory lawmaker Rees-Mogg: “The choice seems to be Mrs. May’s deal or no Brexit”

Latest comments are crossing the wires from the UK Conservative and Member of Parliament for North East Somerset. Jacob Rees-Mogg, via Twitter, as he officially supports the UK PM Theresa May’s Brexit deal. Rees-Mogg tweeted: “Deal-or-No-Brexit “becomes the choice eventually…May’s deal is better than not leaving at all”.

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UK Tory lawmaker Rees-Mogg: “The choice seems to be Mrs. May’s deal or no Brexit”

North Korea: Trump was open to easing sanctions with ‘snapback’ clause – Yonhap

South Korean news agencies Yonhap and Newsis reported a statement published by North Korea late-Monday, citing that the US President Donald Trump was open to easing sanctions on North Korea provided there was a ‘snapback’ clause if the North restarted nuclear activities. Trump said on Friday he decided against imposing new large-scale sanctions on North Korea over its nuclear weapons programme, according to Reuters.

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North Korea: Trump was open to easing sanctions with ‘snapback’ clause – Yonhap

NZ: Regional economic confidence deteriorated in the March 2019 quarter – Westpac

According to the Westpac-McDermott Miller Regional Economic Confidence survey, New Zealand’s regional economic confidence deteriorated in the March 2019 quarter, with eight of eleven regions recording a fall, contrasting to the previous quarter where all regions had posted gains. Key Quotes “The biggest falls in confidence were in Auckland, Nelson/Marlborough/West Coast, and Canterbury.” “Auckland is by far the most pessimistic region in the country.” “The only regions to report improved household confidence were fast growing Waikato and the Bay of Plenty, which is the most confident region in the country.” “Recent outperformers on the east coast of the North Island and the southern part of the South Island all experienced sharp drops in confidence as their overheating economies showed signs of cooling.”

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NZ: Regional economic confidence deteriorated in the March 2019 quarter – Westpac

US imposes first new North Korea sanctions since failed Hanoi summit – Reuters

Reuters reports that late on Thursday, the US imposed sanctions on two Chinese shipping companies it says helped North Korea evade sanctions over its nuclear weapons program. These are the first sanctions imposed by the US following the failed meeting between the US President Trump and the North Korean leader Kim Jong-Un held last month in Hanoi. The US Treasury Secretary Steven Mnuchin said in a statement: “The United States and our like-minded partners remain committed to achieving the final, fully verified denuclearization of North Korea and believe that the full implementation of North Korea-related U.N. Security Council resolutions is crucial to a successful outcome”. “Treasury will continue to enforce our sanctions, and we are making it explicitly clear that shipping companies employing deceptive tactics to mask illicit trade with North Korea expose themselves to great risk,” he added.

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US imposes first new North Korea sanctions since failed Hanoi summit – Reuters

AUD/JPY: Risk sentiment remains challenged around key events, politics

Pre-Fed risk aversion joins hands with the political news concerning the US-China trade deal and North Korea’s nuclear plans. While 50-day SMA offers immediate support, upside momentum can be questioned before key events like FOMC. AUD/JPY trades around 79.00 before European markets open on Wednesday. Trade sentiment remains challenged ahead of key events like the Federal Reserve’s monetary policy meeting whereas developments surrounding the US-China trade talks and recent updates from North Korea add pressure on investors. The AUD/JPY initially reacted to the report mentioning China likely refraining from trade offers, headline lawmakers like the US treasury secretary Steve Mnuchin and trade representative Robert Lighthizer up for meeting the dragon nation in next week and monetary policy meeting minutes from the Bank of Japan (BOJ). However, moves were capped off-late as global markets adhered to pre-Fed risk aversion whereas report from South Korea that the North Korean leader Kim Jong Un may announce nuclear details today built further pessimism. While political moves surrounding the US-China trade talks and updates for North Korea can play background music for near-term trading, the US Fed’s monetary policy meeting may acquire major attention. The reason could be brighter chances for the central bank’s reduction of the 2019 rate-hikes from two to one. AUD/JPY Technical Analysis 50-day simple moving average (SMA) level of 78.65 may become immediate support ahead of drawing market attention to 78.00 and an upward sloping supportline near 77.80. Meanwhile, 100-day SMA level of 79.70 acts as immediate resistance, a break of which can push buyers to aim for 80.00 and 80.50 number including 200-day SMA.

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AUD/JPY: Risk sentiment remains challenged around key events, politics

JPY bullish: N. Korea’s Kim could announce suspension on nuclear testing today – Chosun

South Korean media, Chosun, reports that the North Korean leader Kim Jong-un could make an announcement on North Korea’s suspension on nuclear development and missile testing as early as today. A diplomatic source in Beijing said, “Kim Jong Un is going to be interviewed on the 20th, and that there is a possibility that the gathering of North Korean ambassadors may be related to it.” A North Korean official said, “The sudden presence of North Korean ambassadors in China, Russia and the United Nations in Pyongyang suggests that a strategic decision on the US-North Korean relationship is imminent.”     

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JPY bullish: N. Korea’s Kim could announce suspension on nuclear testing today – Chosun

Japan’s Suga: Will continue to back nuclear disarmament talks between US and N. Korea

Japanese Chief Cabinet Secretary Yoshihide Suga is on the wires now, via Reuters, making some comments in response to the earlier reports that cited North Korea considering suspending nuclear talks with the US . Key Points: Will continue to back nuclear disarmament talks between US and North Korea. Wants to cooperate closely with the related countries. Hopes to reach a resolution on abduction, nuclear and missile problems.

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Japan’s Suga: Will continue to back nuclear disarmament talks between US and N. Korea