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Market Review - 13/05/2013 22:41GMT
Dollar rises on better-than-expected retail sales
The greenback rose against most of its major peers after a report showed U.S. retail sales unexpectedly increased in April, boosting optimism that the country's economy is recovering.
U.S. retail sales in April came in at 0.1% m/m, better than the market expectation of -0.3%.
Versus the Japanese yen, the greenback opened higher in New Zealand after G7 Finance Ministers accepted the yen's recent weakness at their meeting over the weekend and price rose to a fresh 4-1/2 year high at 102.15 ahead of Asian open. Dollar pared intra-day gains and retreated to 101.52 in early European morning before trading sideways, however, price rose to 102.05 at New York open after data showed U.S. retail sales unexpectedly increased.
The single currency opened lower in New Zealand and continued to trade sideways through Australia and Asian morning. Euro edged higher to 1.2992 in early European morning before briefly retreating to 1.2952, however, price rebounded to 1.2996 ahead of New York open.
Despite falling briefly but sharply to an intra-day low at 1.2941 on dollar's strength after the release of better-than-expected U.S. retail sales, price pared intra-day losses and rose to session high at 1.3000 before easing in New York afternoon.
Earlier in European morning, the single currency was pressured due to the comments from ECB's poilicymaker Visco (Bank of Italy governor) as he said 'If the economy needs further help, ECB may cut deposit rate to negative territory; personally think cutting deposit rate would be effective; there may be unintended consequences to negative deposit rates, but we know how to work on that.'
The British pound traded in a narrow range in Asia and edged higher to 1.5381 in early European morning before trading sideways. Despite marginal rise to session high at 1.5385 ahead of New York open, cable tumbled to an intra-day low at 1.5275 New York morning due to dollar's broad-based strength and active cross-selling of sterling vs euro (eur/gbp rallied from 0.8435 to 0.8493).
In other news, Greek PM Samaras said 'quarterly visits from EU/IMF inspectors to Athens to end, next visit to Greece to occur in October.' EU's Commissioner Olli Rehn said 'sees board agreement in G-7 on growth, jobs; and says 'credible medium-term fiscal consolidation plans needed; gradual fiscal consolidation must continue in EU; central banks have used board, diverse range of tools; speculation about "currency wars" is unfounded.'
On the data front, Swiss retail sales in March came in at -0.9% y/y, weaker than the expectation of 0.8%, prior reading is revised to 2.3% from 2.4%.
Data to be released on Tuesday:
Japan domestic CGPI, machine tool orders, Germany WPI, CPI, HICP, ZEW current conditions, economic sentiment, U.K. house prices, Italy CPI, HICP, EU industrial production, ZEW economic sentiment, U.S. import price index, export price index and redbook retail sales.
Dollar rises on better-than-expected retail sales
The greenback rose against most of its major peers after a report showed U.S. retail sales unexpectedly increased in April, boosting optimism that the country's economy is recovering.
U.S. retail sales in April came in at 0.1% m/m, better than the market expectation of -0.3%.
Versus the Japanese yen, the greenback opened higher in New Zealand after G7 Finance Ministers accepted the yen's recent weakness at their meeting over the weekend and price rose to a fresh 4-1/2 year high at 102.15 ahead of Asian open. Dollar pared intra-day gains and retreated to 101.52 in early European morning before trading sideways, however, price rose to 102.05 at New York open after data showed U.S. retail sales unexpectedly increased.
The single currency opened lower in New Zealand and continued to trade sideways through Australia and Asian morning. Euro edged higher to 1.2992 in early European morning before briefly retreating to 1.2952, however, price rebounded to 1.2996 ahead of New York open.
Despite falling briefly but sharply to an intra-day low at 1.2941 on dollar's strength after the release of better-than-expected U.S. retail sales, price pared intra-day losses and rose to session high at 1.3000 before easing in New York afternoon.
Earlier in European morning, the single currency was pressured due to the comments from ECB's poilicymaker Visco (Bank of Italy governor) as he said 'If the economy needs further help, ECB may cut deposit rate to negative territory; personally think cutting deposit rate would be effective; there may be unintended consequences to negative deposit rates, but we know how to work on that.'
The British pound traded in a narrow range in Asia and edged higher to 1.5381 in early European morning before trading sideways. Despite marginal rise to session high at 1.5385 ahead of New York open, cable tumbled to an intra-day low at 1.5275 New York morning due to dollar's broad-based strength and active cross-selling of sterling vs euro (eur/gbp rallied from 0.8435 to 0.8493).
In other news, Greek PM Samaras said 'quarterly visits from EU/IMF inspectors to Athens to end, next visit to Greece to occur in October.' EU's Commissioner Olli Rehn said 'sees board agreement in G-7 on growth, jobs; and says 'credible medium-term fiscal consolidation plans needed; gradual fiscal consolidation must continue in EU; central banks have used board, diverse range of tools; speculation about "currency wars" is unfounded.'
On the data front, Swiss retail sales in March came in at -0.9% y/y, weaker than the expectation of 0.8%, prior reading is revised to 2.3% from 2.4%.
Data to be released on Tuesday:
Japan domestic CGPI, machine tool orders, Germany WPI, CPI, HICP, ZEW current conditions, economic sentiment, U.K. house prices, Italy CPI, HICP, EU industrial production, ZEW economic sentiment, U.S. import price index, export price index and redbook retail sales.
