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May 24, 2024

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Banxico Minutes: Unanimous Pause, Diverging Cuts
Paying Article

May 24, 2024 9:24 PM UTC

Banxico maintained the policy rate at 11%, reflecting a cautious stance amid persistent inflation and economic uncertainty. The board was unanimous in this decision but divided on the timing of future cuts. Despite expectations for a rebound in economic activity, concerns about inflationary pressure

FX Weekly Strategy: May 27th-31st
Paying Article

May 24, 2024 2:42 PM UTC

CPI data at the end of the week limits early week volatility
Still scope for some action in USD/JPY in particular
CHF remains vulnerable, NOK may represent the best carry trade
GBP has potential to rise on declining  risk premium

U.S. May Final Michigan CSI - Less weak than the preliminary, with less of a bounce in inflation expectations
Paying Article

May 24, 2024 2:21 PM UTC

May’s preliminary Michigan CSI showed a substantial fall in confidence and a significant rise in inflation expectations. The final data shows a slightly smaller fall in confidence and less evidence of rising inflation expectations.

Canada March Retail Sales - Soft month, subdued quarter, but stronger April expected
Paying Article

May 24, 2024 1:26 PM UTC

Canada’s 0.2% decline in March retail sales  was a little weaker than the preliminary unchanged estimate given with February’s report, and the detail looks weaker still, with sales down by 0.6% ex autos and overall sales down by 0.4% in real terms. The preliminary signal for April however is po

U.S. April Durable Goods Orders - Rise fully on defense but some underlying improvement
Paying Article

May 24, 2024 12:58 PM UTC

April durable goods orders are stronger than expected, and while the gains of 0.7% overall and 0.4% ex transport are moderate, they are a little above recent trend. While the overall rise came fully on defense, gains in non-defense capital ex aircraft orders of 0.3% and shipments of 0.4% suggest bus

European Summary and Highlights 24 May
Paying Article

May 24, 2024 10:26 AM UTC

In a quiet European morning, EUR/USD gained 20 pips to 1.0830, USD/JPY slipped 10 pips to 157, EUR/CHF gained around 15 pips to test the recent highs, and EUR/NOK fell 4 figures to its lowest since March near 11.50.

Psychology for major markets May 24th
Paying Article

May 24, 2024 10:00 AM UTC

USD supported after strong PMI

This week's five highlights
Paying Article

May 24, 2024 10:00 AM UTC

This week's Fed Speaker and May FOMC Minute Review
RBNZ Keeping Restrictive Rates Longer
UK Called for July Election
UK Inflation Falls Further Amid More Signs of Price Persistence
Canada April CPI Shows Continued Progress in the BoC core rates

FX Daily Strategy: N America, May 24th
Paying Article

May 24, 2024 8:59 AM UTC

JPY to focus more on intervention threat than Japanese CPI
Levels suggests intervention likely but timing uncertain
GBP to maintain firm tone despite softer PMIs
CHF looks a more attractive funding currency than the JPY

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UK Sales Weakness Curbing Pricing Power?
Paying Article

May 24, 2024 7:05 AM UTC

Ending an interesting week of UK data, retail sales slumped in April, partly due to what was a wet month.  Notably, sales volumes fell by 2.3% m/m following a broadly flat February and March 2024 and were down by 2.7% y/y and 3.8% below their pre-pandemic level.  This weaker-than-expected outcome

Chart EUR/GBP Update: Consolidating test of .8500 low
Paying Article

May 24, 2024 6:52 AM UTC

Steadied at the .8500 support as prices unwind the oversold intraday and daily studies and consolidate losses from the .8620 high

GBP flows: GBP briefly dips on weaker retail sales
Paying Article

May 24, 2024 6:28 AM UTC

Weaker than expected April retail sales are likely erratic and will have little sustained impact on GBP

Chart USD/CHF Update: Consolidating, scope to extend gains
Freemium Article

May 24, 2024 6:26 AM UTC

Consolidating test of the .9150/55 congestion

Chart USD Index DXY Update: Extending gains, room to 105.50/75 area
Paying Article

May 24, 2024 5:12 AM UTC

Consolidation below the 105.00 level has given way to break higher to extend gains from the 104.25/00 support

FX Daily Strategy: Europe, May 24th
Paying Article

May 24, 2024 4:43 AM UTC

JPY to focus more on intervention threat than Japanese CPI
Levels suggests intervention likely but timing uncertain
GBP to maintain firm tone despite softer PMIs
CHF looks a more attractive funding currency than the JPY

AUD/USD flows: Weak Regional sentiment
Paying Article

May 24, 2024 4:42 AM UTC

Regional equities in Japan, Hong Kong and China are all in the red 

USD/JPY flows: CPI continues to tread lower
Paying Article

May 24, 2024 4:21 AM UTC

Japan April all three item CPI continue to moderate

Chart GBP/USD Update: Extending pullback from the 1.2760 spike high
Paying Article

May 24, 2024 1:44 AM UTC

Break of the 1.2700 level extending pullback from the 1.2760 spike high

Chart EUR/USD Update: Weighing on the 1.0812/00 support
Paying Article

May 24, 2024 1:34 AM UTC

Lower to extend consolidation below the 1.0900 level as prices unwind the overbought daily studies to reach support at the 1.0812/00 congestion

Chart EUR/JPY Update: Limited gains above the 170.00 level
Paying Article

May 24, 2024 1:04 AM UTC

Remains in consolidation below the 170.00 level after failure to sustain break to 170.30 high

May 23, 2024

FX Daily Strategy: Asia, May 24th
Paying Article

May 23, 2024 9:00 PM UTC

JPY to focus more on intervention threat than Japanese CPI
Levels suggests intervention likely but timing uncertain
GBP to maintain firm tone despite softer PMIs
CHF looks a more attractive funding currency than the JPY

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As Expected, CBRT Kept Key Rate Unchanged at 50%
Paying Article

May 23, 2024 7:30 PM UTC

Bottom Line: As predictions were centred around no change, Central Bank of Turkiye (CBRT) kept the policy rate stable at 50% on May 23 despite galloping inflation which edged up to 69.8% in April, up from 68.5% in March. CBRT said in a statement on May 23 that "(...)considering the lagged effects of

FX Daily Strategy: APAC, May 24th
Paying Article

May 23, 2024 3:05 PM UTC

JPY to focus more on intervention threat than Japanese CPI
Levels suggests intervention likely but timing uncertain
GBP to maintain firm tone despite softer PMIs
CHF looks a more attractive funding currency than the JPY

U.S. April New Home Sales - Losing momentum
Paying Article

May 23, 2024 2:18 PM UTC

April new home sales at 634k are weaker than expected, with March’s unexpectedly strong 693k outcome revised down to 665k, with April down 4.7% after a revised 5.4% March increase. While the decline does not fully reverse March’s increase housing data mostly is suggesting a loss of momentum. 

USD flows: USD rises on strong PMIs
Paying Article

May 23, 2024 2:02 PM UTC

Much stornger than expected US services PMI boost the USD across the board

U.S. May S&P PMIs - Rebounding from weaker April, Services to a 12-month high
Paying Article

May 23, 2024 2:01 PM UTC

May’s stronger preliminary S and P PMIs contrast April data which suggested a loss of momentum in the economy entering Q2, with manufacturing rising to 50.9 from 50.0 and services seeing quite a sharp bounce to 54.8 from 51.3, more than fully reversing three straight declines.

Preview: Due May 24 - U.S. April Durable Goods Orders - Underlying trend remains near flat
Paying Article

May 23, 2024 1:10 PM UTC

We expect April durable goods orders to fall by 0.8% after a rise of 0.9% in March (after annual revisions were released on May 14) with a 0.3% increase ex transport to follow an unchanged March. Underlying trend remains close to flat. 

U.S. Initial Claims suggest any labor market slowing is marginal
Paying Article

May 23, 2024 12:45 PM UTC

Initial claims at 215k have fallen from 223k, a second straight fall from the 232k outcome two weeks ago that was the highest since August 25 2023. The latest data is not much above the trend seen before the spike of two weeks ago, suggesting that while the labor market may be easing slightly, it is

European Summary and Highlights 23 May
Paying Article

May 23, 2024 10:33 AM UTC

EUR/USD gained around 15 pips to 1.0845 in the European morning helped by slightly better than expected Eurozone PMI data.

Psychology for major markets May 23rd
Paying Article

May 23, 2024 10:03 AM UTC

EUR supported after strong PMI

FX Daily Strategy: N America, May 23rd
Paying Article

May 23, 2024 9:10 AM UTC

PMIs the focus for Thursday
More relative US weakness could undermine the USD
GBP well bid and could benefit from election talk
JPY weakness could trigger intervention very soon

GBP flows: GBP slips wih UK PMI
Paying Article

May 23, 2024 8:44 AM UTC

UK composite and services PMI weaker, manufacturing better, GBP lower.

EUR flows: EUR firm on better Eurozone PMI
Paying Article

May 23, 2024 8:04 AM UTC

Eurozone PMI slightly avove expectations driven by strong manufacturing

Chart GBP/JPY Update: Focus on the 200.55, April YTD high
Paying Article

May 23, 2024 7:48 AM UTC

 Break above the 197.10/198.00 resistance extending rally to approach the 200.00 level

EUR flows: EUR recovers on stronger German PMIs
Paying Article

May 23, 2024 7:36 AM UTC

German PMIs come in stronger than expected, reversing the impact of the weaker French numbers earlier. The Eurozone numbers as a whole now look likely to come in broadly in line with the modestly stronger consensus.  

EUR flows: EUR softer on French PMIs
Paying Article

May 23, 2024 7:20 AM UTC

Much weaker than expected French services and composite PMIs for May. These are likely to weigh on EUR/USD if repeated in the German and Eurozone data.  

Chart EUR/GBP Update: Extending losses, focus on the .8500/.8492 lows
Paying Article

May 23, 2024 7:12 AM UTC

Further extend losses from the .8645 high of April

USD, JPY, AUD, EUR flows: USD firm, AUD and JPY soft
Paying Article

May 23, 2024 7:10 AM UTC

USD firm after FOMC minutes. AUD suffering as China stocks ease. JPY pressures intervention levels

Chart EUR/CHF Update: Extending gains
Paying Article

May 23, 2024 6:39 AM UTC

Extending gains and break above the .9900, 76.4% Fibonacci retracement, see room to the .9950 congestion

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Support to ANC is on the Rise
Paying Article

May 23, 2024 6:24 AM UTC

Bottom line: We continue to foresee two possible outcomes of South African presidential elections on May 29, either an African National Congress (ANC) win (40% probability) or a coalition government (60% probability). According to recent polls, ANC continues to be at the risk of losing its majority

Chart USD/CAD Update: Extending corrective bounce from 1.3600/1.3590 support
Freemium Article

May 23, 2024 6:15 AM UTC

Break above the 1.3650 resistance extending gains from the 1.3600/1.3590 support 

Chart USD/CHF Update: Consolidating test of .9150/55 congestion
Freemium Article

May 23, 2024 5:42 AM UTC

Break above the .9100 level has seen gains to reach the .9150/55 congestion

FX Daily Strategy: Europe, May 23rd
Paying Article

May 23, 2024 5:16 AM UTC

PMIs the focus for Thursday
More relative US weakness could undermine the USD
GBP well bid and could benefit from election talk
JPY weakness could trigger intervention very soon

USD/JPY flows: Following USD moves
Paying Article

May 23, 2024 5:12 AM UTC

USD/JPY touched a high since May 1st and retreats

AUD/USD flows: Caution from Chinese Military Drills
Paying Article

May 23, 2024 4:46 AM UTC

Chinese State Broadcaster says Chinese military drills are punishment for Taiwan
Australian May Consumer Inflation Expectations at 4.1% y/y

Chart USD Index DXY Update: Extending corrective bounce from the 104.25/00 support
Paying Article

May 23, 2024 4:10 AM UTC

Extending gains from the 104.25/00 support area as prices unwind the oversold daily studies

Chart GBP/USD Update: Room for deeper pullback from 1.2760 spike high
Paying Article

May 23, 2024 1:33 AM UTC

Saw spike to reach 1.2760 high ahead of pullback as prices unwind the overbought intraday and daily studies

Chart EUR/USD Update: Leaning lower in consolidation below 1.0900 level
Paying Article

May 23, 2024 1:15 AM UTC

 Break of 1.0850 congestion see prices leaning lower to extend consolidation below the 1.0900 level