The Morning Briefing is prepared daily at the start of the European Trading session by RTFX’s trading desk. It presents a roundup of the major news headlines occurring within the global economy that may affect the forex market. This news bulletin also includes a view of our forex calendar for the day, highs and lows achieved in the previous sessions from the forex market, global indices and commodities and brief commentary about the economic headlines.
Morning Briefing for Tuesday, 03 Apr 2012 (Updated 09:05:03 CET)Yen extends gains, AUD weighed by RBA statement
Forex: Yen extends rise to 3-week high versus dollar on short-covering
Global Markets: Shares buoyed by strong US manufacturing report, Nikkei weighed by strong yen
Australia: RBA kept rates unchanged at 4.25%; release dovish policy statement
China: Non-manufacturing PMI surges higher to 58.0 from 48.4
Euro zone: Disappointing manufacturing PMIs point at mild recession in euro zone
United States: ISM PMI rises to 53.4 versus consensus for 53.0
United States: FOMC meeting minutes due at 20:00 CET
Forex rates in Asia and Indices:
EUR/USD: 1.3312 – 1.3355
USD/CHF: 0.9014 – 0.9043
GBP/USD: 1.6020 – 1.6047
USD/JPY: 81.55 – 82.23
EUR/CHF: 1.2036 – 1.2042
EUR/JPY: 109.57 – 108.70
DowJones: 13'264.49 +0.40%
NASDAQ: 3'119.70 +0.91%
S & P 500: 1'419.04 +0.75%
Nikkei: 10’050.39 -0.59%
Shanghai: 2’262.79 +0.47%
Gold: $ 1’680.70
Crude Oil: $ 104.92
The yen continued its rise on Tuesday, hitting a 3-week high versus the US dollar as stop loss orders were triggered with forex investors taking their profits on short yen positions. Meanwhile the euro took a breather on Tuesday, after selling off on Monday following downbeat euro zone manufacturing and employment data.
The dollar was under pressure across the board, as a strong ISM print from the United States and a surging Chinese non-manufacturing PMI number lifted risk appetite and dampened demand for safe-haven assets. EUR/USD recovered more than 0.20 percent to 1.3355 after hitting a low of 1.3278 after PMI data from Europe pointed at a mild recession in the common currency area.
USD/JPY edged lower on Tuesday, after dipping more than 110 points on Monday. The pair hit a 3-week low of 81.55, after closing below its 20-day moving average and the 23.6 percent fibonacci retracement level of the February low to March high move, by 82.73 and 82.25 respectively. It gathered pace after stop-losses reported in the 81.90 – 80 areas were triggered.
Early on Tuesday, the Reserve Bank of Australia announced it was keeping its rates unchanged at 4.25 percent. Initially the Australian dollar was pushed higher to a session high of 1.0466 versus the greenback but plummeted lower after a policy statement sounded more dovish than expected. AUD/USD plunged to 1.0390 as forex investors believe the RBA may cut rates in May if Q1 inflation reading falls lower. The RBA said growth was deemed to be “somewhat below trend” and “somewhat lower than earlier estimated” which represents a significant shift from the “close to trend” language used previously.
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