Archived IMT (2011.04.06)

China's surprise rate hike keeps the focus on the inflationary genie and the various global central banks attempts to keep it in its bottle. Chinese non manufacturing PMI earlier this week suggested prolonged robustness as does this mornings HSBC services PMI for March, which came in at 51.7 as Chinese authorities strive to front load their fight against inflation. Todays UK focus ahead of tomorrows key rate meetings remains on the pound with the release of Feb industrial and manufacturing production data with expectations of increases of 0.4% and 0.6% respectively. While there is also the small matter of a PORTUGUESE BOND AUCTION TODAY of EUR 1bn of six and twelve month bills after another Moodys downgrade yesterday, we also have Eurozone final GDP numbers for Q4, with no change expected from the previous print of 0.3%. Yesterdays weak Ezone Feb retail sales shows consumers remain as cautious as they are in the UK, despite similarly positive PMI figures. EURUSD nears CONFLUENCE RESISTANCE OF 1.4280. EURCHF breaks above key resistance and its 2011 highs around 1.3200, from its double bottom lows at 1.2400. If sustained, could pave the way for 1.3500. GBPUSD resistance now elevates near 1.6350 and USDJPY is set to test the 85.90 trendline resistance from the 2007 highs at 124.00. By KM - AshrafLaidi.com Staff