Forex Forecast

Payrolls Ahead Eurozone PMIs disappointed again, kicking off another round of moderate euro selling. The flash estimates for April had already been on the soft side when they were released almost two weeks ago, but today’s final figures were even weaker still.

RBA Increasingly Dovish The RBA’s quarterly Statement on Monetary Policy provided further colour on the decision to cut the cash rate by 50 bp on Tuesday. End-2012 forecasts for both core inflation and GDP were modestly downgraded.

Draghi Denies The Doves Though the ECB left rates unchanged as expected, dollar bulls were initially emboldened by ECB President Draghi’s reference to “downside risks” to the economic outlook and the steeper than expected 27k drop in US initial jobless claims to 365k.

ECB In Focus Expectations continued to build that today’s ECB press conference could see the central bank turn significantly more dovish., with euro negative consequences. Although a series of bond auctions in Spain and France passed with little implications, Wednesday’s series of worrisome Eurozone data prints would certainly seem to warrant a rhetorical shift.

ECB Decision Due Expectations are building that today’s ECB press conference could see the central bank turn significantly more dovish., with euro negative consequences. Wednesday’s series of worrisome Eurozone data prints would certainly seem to warrant a rhetorical shift.

Weaker ADP Payrolls The euro sold off on Thursday after a series of worrisome data prints out of the Eurozone, which pointed to weaker economic activity – not just in the periphery but also in Germany. Many indicators registered sharp drops from the previous month, and even though the Eurozone manufacturing PMI only showed a […]

Euro Hit By Weak Data The euro came under pressure after a series of poor data prints out of the Eurozone. Eurozone manufacturing PMI fell to 45.9 vs 46.0 consensus, a 34-month low. Readings in the periphery were more concerning however, with some of the components showing sharp drops.

Aussie Steadies The Australian dollar consolidated overnight in the wake of Tuesday’s surprisingly-aggressive 50 bp cut by the RBA. A slight upward revision to the private sector PMI out of China helped steady the ship, but memories of the RBA’s move were too fresh to allow AUDUSD to mount a significant recovery.

Positive Surprise In US ISM The US manufacturing ISM index rose to 54.8 in April from 53.4 (cons: 53.0, UBSe: 53.5) giving the dollar a slight boost in an otherwise quiet session. The dollar rallied against many of its peers with the USDJPY gaining 50 pips, as US treasury yields rose.

Soft UK Manufacturing PMI The pound was the standout underperformer in the European session as manufacturing PMI fell to a headline reading of 50.5 after a downwardly revised 51.9 (52.1) in April. Most of the components of the report were weak with new orders at the lowest levels since November and exports at the lowest […]

RBA Cuts 50 bp The RBA cut the cash rate by 50 bp overnight, hugely surpassing market expectations. A cut had been expected, but the vast majority of economic opinion had been looking for a smaller 25 bp.