Intraday Market Thoughts

EUR Does 1.3120, CPI Is Next

by Patrik Urban
Sep 14, 2012 13:03

Rally continues; Eurozone CPI steady; USDJPY trades higher as treasuries decline; ecofin meeting; precious metals keep gains. Markets await for CPI, retail sales; industrial production and university of Michigan consumer confidence. Wednesdays Premium Insights from Ashraf saw, 1 of 2 longs in EURUSD hit the 1.2980 target, while the other remained unfilled. Both USDJPY shorts nearing their targets. 1st of 2 longs in GBPUSD hit 1.6160 target, while the other is in progress nearing its own objective. See more details on CADJPY, gold and oil below in the final paragraph.

The post FOMC rally continues and the buck is sold across the board except JPY. EURUSD trades just below 1.32, GBPUSD jumped to 1.6244 and EURGBP rose to 0.8066. European equities are gaining nearly 2%.

Eurozone CPI remained steady in August at 2.6% y/y but the core figure slowed to 1.5% from previous 1.7%. Employment in the Eurozone was unchanged in Q2 which is the first time since last year that the number of employees did not contract.

Jawboning from Japanese officials along with higher US treasury yields helped to push JPY lower across the board. USDJPY moved back above the 78.00 figure from yesterday's low 77.13 but that is still in the "high risk of intervention" territory. US 10 year yield gained nearly 6% and trades around 1,81%.

The meeting of Eurozone finance ministers begins today in Cyprus and continues tomorrow. Topics will include the possibility of giving more time to Greece to reach its budget goals and possible financial aid for Spain.

Precious metals moved slightly higher during the London session following sharp gains seen yesterday. Spot gold and silver continue to trade near session highs around 1775 and 34.75 respectively. WTI was able to regain the 100 handle.

The NY session starts at 8:30 am ET with August CPI that is expected to rise 0.5% from a previous flat reading m/m and to 1.6% from 1.4% y/y. Core CPI is seen growing 0.2% from 0.1% m/m but easing to 2.0% from 2.1% y/y. Retail sales that are due at the same time are anticipated to slow to 0.7% in August from 0.8% in July.

Industrial production hits the screens at 9:15 am ET and it is projected to decline to 0.1% from 0.6% and finally the university of Michigan consumer confidence at 9:55 am is expected to decline marginally in September to 74 from 74.3.

CADJPY hit all targets, 1 gold all done, the other in progress. Neither US crude not AUDUSD long were filled. DIRECT ACCESS TO THE EXISTING CALLS found here: sub01/access/?a=681 Non Subscribers please click here:


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