The Canadian economy rose at a 5.6% rate during the first quarter according to data released on Tuesday, slightly below expectations. According to National Bank of Canada analysts, the report does not change their view for strong growth in the second half of 2021. Key Quotes: “While real GDP growth in Q1 was below consensus
FX
Analysts at HSBC raised their forecasts on the Chinese yuan, as they see the currency strengthening more than expected recently. Key quotes “Q2 6.25 vs. prior forecast at 6.5, Q3 6.45 vs. 6.5 previous. “ “By end-2021, USD/CNY will revert to 6.6.“ “Net FX inflows to China have moderated slightly YTD.” “Expect this narrowing trend
Lee Sue Ann, Economist at UOB Group, sees the RBA leaving the policy rate unchanged at its meeting on June 1st. Key Quotes “We continue to expect the cash rate to remain unchanged until 2024 and expect a full AUD100bn extension of quantitative easing (QE) beyond the second round”. “That said, we think that Yield
What you need to know on Monday, May 31: Market players are still willing to sell the greenback on upward moves, suggesting the American currency will remain on the backfoot these days. The greenback keeps moving alongside US government bond yields, which reflect US inflation expectations. Upbeat US data provided temporal support to the USD,
Previewing next week key data releases from the US, “payrolls probably rose strongly by pre-covid standards but we see some downside risk versus the consensus again this month,” said TD Securities anaysts. Key quotes “Our forecast implies a still-sizeable 7.7mn net decline from the pre-COVID level. The unemployment rate probably resumed its downtrend after a surprising
GBP/USD trims losses as the US dollar pulls back, remains in the range The GBP/USD bottomed before the release of US data at 1.4135 amid a rally of the US dollar across the board. Afterward, the greenback lost strength favoring a rebound in cable back above 1.4150. The intraday bias still points to the downside
Here is what you need to know on Friday, May 28: It was AMC day on US stock markets on Thursday as the cinema operator totally took control of the volume profile, outdoing every mega-cap and growth stock in the process. AMC rose over 35% as retail and perhaps some other operators stoked the fizzle
XAU/USD continues to edge lower after failing to close above $1,900. Rising US Treasury bond yields weigh on gold in the second half of the week. US PCE inflation preview: Gold remains key asset to watch. The XAU/USD pair reached its highest level since early January at $1,912 on Wednesday but ended up closing the
Asian shares struggle to keep recent gains around two-week top. Sino-American trade chatters are back in fashion, RBNZ’s Orr weighs on NZX 50. Aussie Capex, China Industrial Production came in softer for April. US Treasury yields remain firm, test the market bulls ahead of the key data. Asian equities remain sidelined around the fortnight top
On Wednesday, the Reserve Bank of New Zealand, kept its monetary policy unchanged as expected, surprising with a hawkish tone that boosted the NZD across the board. According to analysts at Wells Fargo, the RBNZ’s announcement represents upside risk to their NZD/USD exchange rate forecast. Key Quotes: “The RBNZ held its Official Cash Rate steady
USD/INR stands on slippery ground near multi-day low, drops for fifth consecutive day. Risk-on mood weighs on the US dollar, downbeat options market also weigh on the quote. SBI report anticipates slower fall in Indian GDP, covid infections in India ease of late. Market sentiment favor bears, risk catalysts are the key to follow. USD/INR
EUR/USD turned south after rising to 1.2266 on Tuesday. US Dollar Index stages a modest recovery during American trading hours. Fed’s Clarida says Fed could discuss scaling purchases in upcoming meetings. The EUR/USD pair climbed to its highest level since early January at 1.2266 on Tuesday but lost its bullish momentum in the second half
The Consumer Price Index (CPI) number in April, which arrived at 4.2% on a yearly basis, was a “very unpleasant surprise,” Federal Reserve’s Vice Chairman Richard Clarida told Yahoo Finance on Tuesday, per Reuters. Additional takeaways “US outlook is very very positive and growth could hit 7%.” “Most recent employment report highlighted near term uncertainty in labor market.”
Bank of England (BoE) Governor Andrew Bailey acknowledged on Monday that the economic recovery in the UK is “quite unbalanced,” as reported by Reuters. “Hopefully, that imbalance will reduce as more services markets reopen from lockdown,” Bailey added. “The risk of high inflation expectations becoming entrenched is not our central view.” Market reaction These comments
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What you need to know on Monday, May 24: The greenback recovered on Friday, ending the week mixed across the FX board. The American appreciated following upbeat US data and comments from Federal Reserve officials suggesting a sooner rather than later discussion on tapering amid signs of heating inflation. On Friday, Atlanta Federal Reserve President
Bitcoin tumbles again as China intensifies crackdown Equity markets fall modestly on Friday as big tech retreats but data remains supportive Fed now flips from behind the curve to thinking about being ahead A tumultuous week but not on Wall Street. Crypto and in particular Bitcoin was the narrative spreading across trading screens this week
The Swiss National Bank (SNB) Chairman Thomas Jordan made some comments on the monetary policy outlook and exchange rate value, in an interview with Swiss daily Neue Zuercher Zeitung on Saturday. Key quotes “The franc remains highly valued.” “Inflation is only slightly above zero.” “Productive capacities are not fully utilized in Switzerland.” “Against this background,