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Market Review - 27/04/2013 00:38GMT
Dollar drops broadly on weaker-than-expected U.S. GDP
The greenback weakened against majority of its peers Friday on the back of weaker-than-expected U.S. GDP growth and tumbled against the Japanese yen after Bank of Japan didn't announce any new monetary easing measures.
U.S. GDP expanded by 2.5% in Q1, weaker than market forecast of 3.0%, U.S. benchmark government bond yields fell to a near 4-1/2 month low as the data raised concerns on U.S. tepid growth as well as possibility of more measures to boost growth by the Fed.
Dollar yen moved the most on Friday, the pair came under pressure at Tokyo open on broad-based buying of yen by Japanese exporters, price briefly tanked to 98.23 after the Bank of Japan kept its rate unchanged at 0.10% and refrained from announcing any new stimulus measures.
Despite a brief recovery to 98.84 in early European morning, dollar resumed intra-day decline and quickly fell after the release of weaker-than-expected U.S. GDP and tumbled to an intra-day low at 97.56 in New York morning. Later, dollar pared some of its intra-day losses and rebounded to 98.33, price traded at 98.09 near New York close.
BOJ governor Haruhiko Kuroda said 'no talk at today's meeting that further easing was needed now; board member Sato, Kiuchi dissented to forecast Japan will see 2% inflation towards Mar 2016.'
Although the single currency rose in Asian morning to session high at 1.3048, price met selling interest there and retreated to 1.2991 at New York open. However, euro staged a rebound to 1.3039 on dollar's broad-based weakness due to poor GDP data before stabilising in New York morning.
Although the British pound rose in tandem with euro in Asian morning to 1.5472, price retreated to session low at 1.5418 in European morning. However, renewed buying quickly emerged and lifted the pound, price climbed to an intra-day high at 1.5499 after release of GDP, however, price traded sideways in New York afternoon and closed around 1.5473.
In other news, ECB Executive Board member Joerg Asmussen said 'road to recovery remains uneven; growth in euro area remains weak; ECB cannot target unemployment; effect of a rate cut would be limited; rates too low could lead to distortions; costs of very low interest rates are real; ECB has to recognize limits of monetary policy; ECB cannot remove constrains of bank lending.'
On the data front, U.S. University of Michigan confidence in Apr came in at 76.4, better than the forecast of 73.2.
Data to be released next week:
China, Japan market holiday, UK housing survey, Germany retail sales, CPI, HICP, U.S. personal income, personal consumption, PCE index and pending home sales on Monday.
Japan manufacturing PMI, household spending, unemployment rate, industrial production, retail sales, housing starts, China market holiday, UK Gfk consumer confidence, mortgage approvals, France PPI, EU CPI, unemployment rate, Canada GDP, PPI, U.S. redbook retail sales, Chicago PMI and consumer confidence on Tuesday.
Australia new home sales, China market holiday, manufacturing PMI, Germany market holiday, UK manufacturing PMI, U.S. ADP employment, manufacturing PMI
Dollar drops broadly on weaker-than-expected U.S. GDP
The greenback weakened against majority of its peers Friday on the back of weaker-than-expected U.S. GDP growth and tumbled against the Japanese yen after Bank of Japan didn't announce any new monetary easing measures.
U.S. GDP expanded by 2.5% in Q1, weaker than market forecast of 3.0%, U.S. benchmark government bond yields fell to a near 4-1/2 month low as the data raised concerns on U.S. tepid growth as well as possibility of more measures to boost growth by the Fed.
Dollar yen moved the most on Friday, the pair came under pressure at Tokyo open on broad-based buying of yen by Japanese exporters, price briefly tanked to 98.23 after the Bank of Japan kept its rate unchanged at 0.10% and refrained from announcing any new stimulus measures.
Despite a brief recovery to 98.84 in early European morning, dollar resumed intra-day decline and quickly fell after the release of weaker-than-expected U.S. GDP and tumbled to an intra-day low at 97.56 in New York morning. Later, dollar pared some of its intra-day losses and rebounded to 98.33, price traded at 98.09 near New York close.
BOJ governor Haruhiko Kuroda said 'no talk at today's meeting that further easing was needed now; board member Sato, Kiuchi dissented to forecast Japan will see 2% inflation towards Mar 2016.'
Although the single currency rose in Asian morning to session high at 1.3048, price met selling interest there and retreated to 1.2991 at New York open. However, euro staged a rebound to 1.3039 on dollar's broad-based weakness due to poor GDP data before stabilising in New York morning.
Although the British pound rose in tandem with euro in Asian morning to 1.5472, price retreated to session low at 1.5418 in European morning. However, renewed buying quickly emerged and lifted the pound, price climbed to an intra-day high at 1.5499 after release of GDP, however, price traded sideways in New York afternoon and closed around 1.5473.
In other news, ECB Executive Board member Joerg Asmussen said 'road to recovery remains uneven; growth in euro area remains weak; ECB cannot target unemployment; effect of a rate cut would be limited; rates too low could lead to distortions; costs of very low interest rates are real; ECB has to recognize limits of monetary policy; ECB cannot remove constrains of bank lending.'
On the data front, U.S. University of Michigan confidence in Apr came in at 76.4, better than the forecast of 73.2.
Data to be released next week:
China, Japan market holiday, UK housing survey, Germany retail sales, CPI, HICP, U.S. personal income, personal consumption, PCE index and pending home sales on Monday.
Japan manufacturing PMI, household spending, unemployment rate, industrial production, retail sales, housing starts, China market holiday, UK Gfk consumer confidence, mortgage approvals, France PPI, EU CPI, unemployment rate, Canada GDP, PPI, U.S. redbook retail sales, Chicago PMI and consumer confidence on Tuesday.
Australia new home sales, China market holiday, manufacturing PMI, Germany market holiday, UK manufacturing PMI, U.S. ADP employment, manufacturing PMI
