Daily FX Market Commentary

Andy Harrison

Good Morning,

For Today

• GBP: Opening a touch high and quickly testing the 1.3900 level on the back of Lowe comments before drifting through into the Tokyo Fix holding around the 1.3885 area before dipping quickly through to the 1.3865 area and holding quietly around that number for the move to the grey hours, Topside offers weak back through the 1.3900 level and light stops limited at best before running into light offers around the 1.3950 area and then increasing resistance through to the 1.4000 before slightly stronger stops appear and the market opens to the 1.4050-1.4100 with patchy resistance until closer to the topside of that range and stronger offers thereafter, downside bids into the 1.3800 level with weak stops likely on a dip through the 1.3780-40 levels with congestion likely to soak up much of the selling through to the 1.3700 level with possibly strong congestion then around the 1.3700 level increasing into the 1.3650 level before being able to make a move to the 1.3600 area and strong bids again.
• JPY: A quiet steady rise from the opening around the 108.50 area to push slowly in a few waves to the 108.85 area just failing to push the 108.90 area for the move into the grey hours, Topside congestion is likely to soak up some of the weak stops above through to the 109.50 area where strong congestion is likely to appear and increasing offers into the 110.00 and like the previous spikes at the beginning of last year any move is likely to find resistance above and continuing through the 110.00 with break out stops likely to be a little more nervous, downside bids light through to the 108.00 level with weak stops on any retrace through the 107.80 level and opening a dip to the 106.00 area possible over the coming week.
• AUD: Lowes dovish comments saw the Oz opening around the 0.7710 area with early trading pushing to fill the gap to the 0.7720 area and then drifting through to the 0.7705 area before dropping quickly through the 77 cents level and test to the 0.7680 where the market held for a long run to the grey hours, Topside offers through the 0.7700-20 area with limited potential for stops however, the offers don’t really look that strong until the 0.7800-20 areas with weak stops likely beyond that area to open up the potential for another higher run, downside bids into the 76 cents level with strong bids likely through to the 0.7580 area, weak stops are likely to be few and far between with stronger bids likely into the 0.7550 level and likely stronger congestion through to the 0.7500 area.
• EUR: A slow drift from the opening around the 1.1900 level and the Euro slowly moving through into the Tokyo session to test through to the 1.1880 area, a long run through to the final hour before Tokyo lunch saw the Euro again drift to test into the low 1.1870 areas, Congestion through the 1.1820-1.1780 area with weak stops possibly being cleared up quickly through to the 1.1750 and again stronger congestion and likely to continue through the 1.1700 level, topside offers light back through the 1.1920 area and weak stops possibly setting up a small short squeeze through to the 1.1980 area before stronger offers start to appear into the 1.2000 level.

Overnight News

CHF:
SNB Affirms intervention threat, welcomes weaker Franc – BBG
SNB’s Zurbruegg: Neg rates, interventions still needed
Zurbruegg: Too early to talk about a rate rise
Zurbruegg: SNB can ease policy further if needed
AUD:
RBA’s Lowe pushes back against market, reiterates 2024 rate call – BBG
JPY:
BoJ Preview: Assessment focusing on sustainable and nimble easing, with risk of miscommunication – JN

Today’s Data

AUD RBA Governor Lowe Speaks
USD FOMC Member Kaplan Speaks
AUD Westpac Consumer Sentiment (MAR) A 2.6% | P 1.9%
CNY CPI MoM (FEB) A 0.6% | C 0.4% | P 1.0%
CNY CPI YoY (FEB) A -0.2% | C -0.4% | P -0.3%
CNY PPI YoY (FEB) A 1.7% | C 1.5% | P 0.3%
1330 USD Core CPI YoY (FEB) A | C 1.4% | P 1.4%
1330 USD Core CPI MoM (FEB) A | C 0.2% | P 0.1%
1330 USD CPI MoM (FEB) A | C 0.4% | P 0.3%
Tentative CAD BoC Rate Statement
1500 CAD BoC Interest Rate Decision A | C 0.25% | P 0.25%
1500 USD Crude Oil Inventories A | P 0.485m
1900 USD Federal Budget Balance (FEB) A | C -265.0b | P 163.0b
2200 AUD RBA Gov. Lowe Speaks

Harry Hindsight

• GBP: Opening around the 1.3820-25 area and the move into the Tokyo session saw the market make a couple of half hearted attempts to breach the 1.3800 level however, after the second move the market turned north and pushed steadily through the midsession to test the 1.3850 level which held through to the grey hours before breaking quickly through into the London session with the market pushing the 1.3880 area as USD sellers started to appear (end of SNB operations?) the market after a minor dip tested the 1.3900 level in a weak move before holding quietly through to the NYK opening and a steady run through to the 1.3925 level for the high of the day before dipping back and holding through to the close in the 1.3885-1.3900 area for the most part.
• JPY: Moving from the opening 108.90 area to hold through into the Tokyo session struggling with 108.95 areas before quickly bouncing higher as JPY sellers moved through the market funds pulled some of their investments, testing initially through to the 109.20 area holding just below initially before moving steadily through the level and struggle with the area through to the grey hours before quickly dropping back and triggering a few weak stops on the move through the opening area to hit the 108.55 level for the move into the first hour in London, A slow recovery through into the NYK session pushing towards the 109.00 level before dipping away again in steady USD selling to test through to the 108.50 area to hold to the close.
• AUD: Limited liquidity through the Sydney period before thickening on a run to the 0.7660 from the 0.7640 area to match the wide first hour, Tokyo sold through for the fix taking the market down through to eh 0.7630 area and a limited follow through before returning to the early highs and ranging around the 0.7660 area to the grey hours, early sellers in Europe tested the 0.7640 area again as London came in buying through to the London opening pushing the 0.7690 area and following through to push lightly to test the 0.7720 area before drifting back and ranging through to the NYK session around the 77cents level, NYK did eventually extend the highs with a slow push through into the 0.7725 area for the move to the last hour and a slow drift for the close.
• EUR: Opening around the 1.1840 area with a slow move through to the 1.1850 areas and a dip into the Tokyo session around the 1.1836 low for the day, a couple of quiet hours saw the market rallying hight through to the 1.1860 level to push to the 1.1865 area into the grey hours, Euro buying through the grey hours continued into the London opening as the market moved through to test to the 1.1910 level before slowing its move higher and dipping a little and pushing a second time to make the high of the day around the 1.1915 area, the market then drifted to spend much of the session ranging around the 1.1890-1.1900 levels through to the close around the topside level.

Best Regards
Andy

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