RICS Housing Market Data Eyed
In the absence of major macro triggers in Britain this morning, market participants will keep a tab on the RICS housing market survey in the UK scheduled later today. The print will gauge activity in the nation’s real estate sector, especially amid signs of a shortage in the housing market.
Across the Atlantic, after yesterday’s retail sales report showed a less than expected rebound for March, investors will note today’s industrial production data in the US to gauge morale among local manufacturers. In the Euro zone, focus among traders is likely to remain on the ECB’s post meeting press conference where comments by Mario Draghi will be digested to verify if he offers any new insight into the ongoing talks between Greece and its creditors.
Pound Sterling – UK Markets
Amid no notable macro triggers in the UK today, Sterling is trading on a weaker footing against the US Dollar this morning. Later today, traders will eye the RICS housing market survey in the UK to gauge prospects of an upside in property rates going forward, particularly after recent surveys indicated a supply constraint in UK’s real estate segment.
Yesterday, the Pound more than offset its early session losses against the greenback and rose above the 1.47 mark following the release of downbeat US retail sales data. Meanwhile a report released in the UK revealed that consumer prices remained unchanged on an annual basis for March, as low energy and food prices continued to weigh on domestic price growth. Furthermore, the underlying measure of consumer inflation, which excludes prices of energy, food, alcohol and tobacco, fell to its lowest level since July 2006. Considering that core inflation in the UK has shown its second consecutive ease for March, concerns among investors have strengthened, particularly after Mark Carney hinted recently that a prolonged period of low inflation might delay the timing of an interest rate rise in the UK.
US Dollar – US Markets
The greenback is trading on a firmer footing against most of its counterparts this morning after soft Chinese GDP data kept demand for safe haven bets buoyed. On the macro front, market participants will note today’s industrial production print in the US, which is expected to show that output among domestic manufacturers declined last month as a surge in the US Dollar weighed on the nation’s export growth.
Yesterday, the US Dollar lost ground against the majors after a print showed that retail sales in the US rose less than expected for March, as lower domestic energy consumption and easing demand experienced by food and beverage and electronics stores offset the surge in car sales last month. A less than anticipated rebound in domestic sales raised concerns among greenback investors given that local demand had shown a decline during the first two months of 2015 on the back of poor winter weather conditions. Meanwhile, another report revealed that producer prices in the US rebounded in line with market estimates for March, strengthening expectations that price growth is stabilising, ahead of the consumer price inflation report scheduled later this week.
Euro – European Markets
Data released earlier today revealed that Germany’s consumer price inflation was in line with the preliminary estimates for March. Meanwhile, the Euro is trading on a weaker footing against the Pound this morning ahead of the ECB’s meeting where the central bank is anticipated to keep interest rates unchanged. The post meeting press conference by the ECB Chief, Mario Draghi, will be anticipated to verify if he sheds light on the latest economic developments in the Euro zone, especially after the central bank recently introduced its massive stimulus programme. Additionally, with differences between Greece and its lenders continuing to dampen sentiment, investors will seek more clarity about the ongoing discussions between Greek officials and its creditors in his comments today.
Yesterday, a report showed that industrial production in the Euro zone rebounded more than expected for February, amid an increase in the output of energy, capital goods and consumer products. Meanwhile, in a noteworthy development, the IMF raised Euro zone’s growth forecasts to 1.5% from 1.2% for 2015 and to 1.6% from 1.4% for 2016.
Other Currencies – Highlights
The Japanese Yen is trading on a weaker footing against the greenback this morning despite the drop in industrial production being revised lower for February in Japan. Separately, the BoJ Governor, Haruhiko Kuroda, stated earlier today that the long-term inflation trend in Japan is improving at a steady rate, especially amid signs of changes in behaviour of corporates in setting wage and sales price levels. Additionally, he indicated that inflation is likely to reach the BoJ’s 2% target by around the middle of next year and shrugged off expectations of further stimulus in the nation, especially after the IMF suggested yesterday that Japan should buy more private assets to achieve its inflation target.
With no other notable triggers on the domestic macroeconomic front, market participants will keep a tab on today’s industrial production data in the US for further direction. Moving ahead, Friday’s consumer price inflation data in the US is likely to keep investors in the US Dollar- Japanese Yen pair interested in the coming week.