Article by: ETO Markets
According to official data provided by the Australian Bureau of Statistics on Thursday, Australia's unemployment rate increased to 4.1% in April, above the previous number of 3.8% and the 3.9% expected. In addition, the Australian Employment Change exceeded the consensus estimate of 23.7K in April, coming in at 38.5K from -6.6K in March.
Following the release of the US's April inflation figures on Wednesday, the US Dollar saw significant losses versus its main competitors and is now finding it difficult to recover. The US economic docket later in the day will include the Philadelphia Fed Manufacturing Survey, weekly Initial Jobless Claims, April housing, and Industrial Production statistics. Investors will also be closely monitoring remarks made by policymakers at major central banks.
According to data released on Wednesday by the US Bureau of Labor Statistics, the Consumer Price Index increased 3.4% annually in April. During the same time period, the annual core CPI grew by 3.6%; both of these numbers were expected by the market. The probability that the Federal Reserve (Fed) would leave the policy rate steady in September decreased from 35% to 25% prior to the announcement of inflation statistics, resulting in a reduction of more than 2% in the yield on the benchmark 10-year US Treasury bond.
Expectations of monetary policy convergence between the US and the Eurozone are growing, which supports the Euro. It is expected that the European Central Bank would cut interest rates at its next meeting in June. However, given that core inflation declined in April for the first time in six months, market expectations are growing that the Fed will start cutting interest rates in September.
Rising hopes for monetary policy convergence between the US and the Eurozone provide support for the Euro. Rates are expected to be lowered by the European Central Bank at its next meeting in June. The market is increasingly anticipating that the Fed will start reducing interest rates in September, especially in light of the fact that core inflation decreased in April for the first time in six months.
As the EUR/USD pair extends a positive recovery from the 200-HMA from … , EUR/USD is making a bullish push at the … handle. The pair is up more than 2.7% from April's swing bottom near … , but intraday bidding has pulled EUR/USD well above technical indicators. The 200-HMA is moving above ...
The work market deteriorated for the third consecutive month in the UK, according to employment figures, while the unemployment rate increased. However, rising service inflation worries Bank of England policymakers since it can slow down the disinflation process. This created doubts regarding the BoE's interest rate reductions.
The current high at … would be the next barrier if buyers were to retake the 100-DMA. A break through of the latter will reveal the high point of April 9 at … , before a rebound to the next supply zone at … , the high point of March 21. When surpassed, the year-to-date high at … would be the next target. On the other hand, sellers are still optimistic that the GBP/USD exchange rate would drop below the 100-DMA and close below it every day, possibly approaching ... The 50-DMA at … would be the next stop after clearing.
