North American Summary and Highlights 30 Apr
Overview - The USD was softer, most notably USD/JPY with the BoJ seen behind the move, though oil coming off its highs saw the USD slipping elsewhere too.
European and North American sessions
The most notable move of the day was a slide in USD/JPY in the European morning, from near 160.50 to extend below 156.50 in North America, with the BoJ believed to be behind the move. Oil moving off a 4-year high encouraged USD losses generally, EUR/USD up to 1.1740 from 1.1670 though underperforming GBP/USD which rose above 1.36 from 1.3460, as EUR/GBP fell to .8625 from .8660. EUR/CHF fell to .9170 from .9240. AUD/USD rose to .72 from .7120 while USD/CAD moved below 1.36 from above 1.3650.
Both the ECB and BoE left rates unchanged. There was little reaction to the BoE with Governor Bailey appearing open to tightening but the ECB was less hawkish than feared seeing the EUR initially dip. Eurozone flash Q1 GDP was weaker than expected with a 0.1% increase, Flash April HICP at a 33-month high of 3.3% was broadly as expected but a dip in the core rate to a 3-month low of 2.2% was not expected. Q1 US GDP was weaker than expected with a 2.0% annualized rise but with the downside surprises coming from rising imports and a smaller than expected bounce in government (particularly defense) the detail was far from weak. Core PCE prices were firmer than expected at 4.3% annualized as was the Q1 Employment Cost Index at 0.9%. Initial claims fell to 189k from 215k, the lowest since 1969. Continued claims at 1.785m from 1.808m were also lower, leaving the overall US data picture looking firm.