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20 Apr 2015
Aussie surges on PBOC RRR cut, Light European calendar
FXStreet (Bali) - The Australian Dollar was the best performing currency in Asia, holding 0.78 after hitting its highest for the week at 0.7844 during interbank trade, followed by its neighboring partner the Kiwi, with the surge fueled on the surprising action taken by the PBOC to cut the RRR rate by 1% for all banks over the weekend.
The rest of currencies traded in smaller and still familiar ranges, with the Japanese Yen continuing to press against key macro level 118.60/80 against the US Dollar, while NZD/USD remains comfortably above 0.76 despite a weaker-than-expected inflation report for Q1 2015.
Main headlines in Asia
ECB's Draghi: It is pointless to go short on the euro
New Zealand CPI falls below expectations in Q1 2015
PBOC RRR cut to boost AUD, NZD for a while - ANZ
Heading into Europe
This coming European session will be light on data, with key releases scheduled for Tuesday, Thursday and Friday, when the ZEW economic expectations, EZ PMIs and German IFO business climate numbers will be released, respectively.
According to Franklin Wang, Strategist at Nomura: "We expect a slight decline to 54.0 in April", adding that "German Ifo business climate index is expected to have increased to 108.3 in April from 107.9 in March."
Later in the US session, BoC Governor Poloz speaks, although as noted by RBS FX Trading Strategist Brian Daingerfield, "we don’t expect anything new relative to last Wednesday’s post-decision press conference."
EUR/USD technicals
Valeria Bednarik, Chief Analyst at FXStreet, shares her insights on the EUR/USD, noting that a break above 1.0838 would allow further advances this week.
"The technical picture shows that the price stalled around the 61.8% retracement of the latest daily decline measured between 1.0134 and 1.0519, last week low, at 1.0838, becoming the immediate resistance level" Valeria said.
"In the 4 hours chart, the 20 SMA advanced below the current price and stands around 1.0700, whilst the technical indicators hold in positive territory, suggesting a break above the mentioned resistance should lead to further advances", Valeria added.
The rest of currencies traded in smaller and still familiar ranges, with the Japanese Yen continuing to press against key macro level 118.60/80 against the US Dollar, while NZD/USD remains comfortably above 0.76 despite a weaker-than-expected inflation report for Q1 2015.
Main headlines in Asia
ECB's Draghi: It is pointless to go short on the euro
New Zealand CPI falls below expectations in Q1 2015
PBOC RRR cut to boost AUD, NZD for a while - ANZ
Heading into Europe
This coming European session will be light on data, with key releases scheduled for Tuesday, Thursday and Friday, when the ZEW economic expectations, EZ PMIs and German IFO business climate numbers will be released, respectively.
According to Franklin Wang, Strategist at Nomura: "We expect a slight decline to 54.0 in April", adding that "German Ifo business climate index is expected to have increased to 108.3 in April from 107.9 in March."
Later in the US session, BoC Governor Poloz speaks, although as noted by RBS FX Trading Strategist Brian Daingerfield, "we don’t expect anything new relative to last Wednesday’s post-decision press conference."
EUR/USD technicals
Valeria Bednarik, Chief Analyst at FXStreet, shares her insights on the EUR/USD, noting that a break above 1.0838 would allow further advances this week.
"The technical picture shows that the price stalled around the 61.8% retracement of the latest daily decline measured between 1.0134 and 1.0519, last week low, at 1.0838, becoming the immediate resistance level" Valeria said.
"In the 4 hours chart, the 20 SMA advanced below the current price and stands around 1.0700, whilst the technical indicators hold in positive territory, suggesting a break above the mentioned resistance should lead to further advances", Valeria added.