- Eurozone April flash consumer confidence -14.7 vs -14.4 expected
- Canada March PPI -0.5% y/y vs -1.7% prior
- Canada March new housing price index 0.0% vs +0.1% expected
- Bank of American now sees USD/JPY peaking this year in the 155-160 range
- Another earthquake felt in Taiwan
Markets:
- Gold down $61 to $2329
- US 10-year yields flat at 4.61%
- WTI crude oil down 12-cents to $82.85
- AUD leads, GBP lags
- S&P 500 up 0.8%
The newsflow was light ahead of a big week of earnings along with some key economic data points. The Fed has entered the blackout so that also helped to keep a lid on the noise.
That said, there was still plenty of volatility. The euro and pound were particularly soft as the US arrived, falling to 1.0625 and 1.2300 respectively. That was an ominous sign for equities, which initially opened solidly higher before giving back all the gains. However seven straight days of declines was too much of the stock market to contemplate and the bulls finally arrived with strong bids.
That helped to turn the tide in FX, returning the euro to unchanged on the day at 1.0650. The pound couldn't complete the comeback but rose a half-cent from the lows.
The commodity currencies outperformed despite strong declines in gold and silver. Oil was choppy as the geopolitical risk faded but it managed to rebound back to unchanged.
USD/JPY is a spot to watch in the hours ahead and for the rest of the week with the BOJ on tap Wednesday. The pair stretched to a fresh 34-year high at 154.86 and eyes are on the big figure as a potential spot where intervention could take place. So far there are no signs of that but the market looks like it wants to tip-toe closer so attention is warranted.
