Officials of the Group of 20 nations or the G-20, primarily composed of finance ministers and also central bankers, convened on Thursday and Friday to discuss market developments and plot the fiscal path moving forward. Japan’s Finance Minister Taro Aso declared that there was no opposition among G-20 nations concerning Japan’s current policies. IMF chief Lagarde even expressed approval of Japan’s monetary policies. Furthermore, US Treasury Secretary Lew confirmed during his discussion with Finance Minister Aso that the monetary policies implemented by Japan were mainly for domestic fiscal purposes.
In other news, a celebrated marathon held in Boston, Massachusetts turned tragic as an unsuspected improvised blast happened near the finish line last Monday. Three people were killed, along with a few dozens that have been injured – 58 of which reportedly remained in the hospital for treatment. In West, Texas, 14 were killed while around 200 people were injured in an explosion at a fertilizer plant.
Commodities
After an impressive fall of $109 during the prior week, Gold fell a massive $174 this week and gold buyers were only able to recuperate a little over half of the decline at the end of the trading week. Gold is now dangerously close to piercing through the 2011 low at $1,308, and bears are surely salivating ahead of another vicious attack at that level. Bulls, on the other hand, must aim for a move above $1,500 this coming week.
Oil did no better than gold as the former also slipped a little over $5, after declining more than $5 and $4 in the last two weeks. Unlike gold though, oil is now sitting in a potential support around $84-$85 which could slow down the attack of the roaring bears.
Currencies
Hats off to EURUSD buyers who made an early effort this week to bring prices higher from the 1.3000 lows. However, all the early gains were quickly neutralized after the sellers have succeeded in arresting the climb right around the 1.3200 area. This resulted in an equally quick decline in prices back towards the 1.3020s – even creating the weekly low right smack at 1.3000 in the process. In the end, the pair was net sold and closed the week at 1.3050.
USDJPY started off the week with a generous decline from the upper-98s. After touching a 95.78 low, discount buyers entered the scene and took price higher in a relatively smooth fashion. The week culminated in a revisit of last week’s high – reaching as high as 99.67 before easing to close the week at 99.47. Bulls must continue to congregate in order to finally breach the 100 level.
GBPUSD remained weak after attempts at a break of 1.5400 easily fizzled out. Buyers were obviously outnumbered as the pair never got near the coveted level this week. With the weekly close near 1.5200, sellers are closer to pressing price back down to the 1.5000 mark. Potential supports are close by, but price action suggests that bear have a good chance of controlling price next week. A clean break of 1.5200 is the key.
The Week Ahead
Monday is pretty much quiet with only US Existing Home Sales as the key economic release on the plate. FOMC Member Dudley and MC Member Tucker are due to give speeches.
On Tuesday, there are Australia’s CB Leading Index; China’s Trade Balance and HSBC Manufacturing PMI; Germany, France, and Euro-area Flash Manufacturing PMI and Flash Services PMI; Italy’s Retail Sales; UK Public Sector Net Borrowing; Canada’s Retail Sales and speech from BOC’s Carney; and US New Home Sales.
On Wednesday, New Zealand will announce its Official Cash Rate along with the RBNZ Rate Statement. Other critical releases include Australia’s CPI; Germany’s Ifo Business Climate; UK BBA Mortgage Approvals; US Durable Goods Orders; and speech from BOC Governor Carney.
On Thursday, the key economic releases are Spain’s Unemployment Rate; UK Preliminary GDP; and US Unemployment Claims. New Zealand and Australia will celebrate Anzac Day, while Italy will observe Liberation Day.
Finally on Friday, there are data releases such as New Zealand’s Trade Balance; Japan’s Rate Announcement, Policy Statement, and Press Conference, along with Manufacturing PMI and CPI; speech from SNB Chairman Jordan; and US Advance GDP.
