The latest Japan Core Machinery Orders, a measure of new private sector purchase orders for machines, jumped three times its estimate in March. Orders increased 19.1 percent versus 6.1 percent forecast, and the previous month’s revised -4.6 percent.
In the United Kingdom, the MPC Asset Purchase Facility and Official Bank Rate votes remained unchanged. Meanwhile, Consumer Price Index rose 1.8 percent in April following a 1.6 percent gain in March. On the other hand, PPI Input dropped 1.1 percent during the same month. Retail Sales rose 1.3 percent.
In other news, the Flash Manufacturing PMI for Japan, China, and the US fared better than estimates, while that for Germany, France, and the Eurozone were all weaker than expected.
In the United States, Jobless Claims for the prior week increased more than anticipated (326,000 versus 312,000 forecast). Existing Home sales rose less than expected, but New Home sales were better in April.
Commodities
Gold continues to trot along close to the $1,300 level just as it has done for more than five weeks now. The stakes become higher as the price range got narrower this week. $1,260 and $1,320 are the key areas of concern. Bulls and bears need to break one of these areas very soon.
Oil printed its second weekly bullish close after a successful break of the $104 finally stuck on Friday. Price is now poised to break northward ahead of stronger resistance in the $108-$112 area.
Currency Pairs
EURUSD saw terrible price action for the third straight week as buyers failed to regain control of the 1.3700 level. Although the weekly trading range was narrow, this pair is still at risk of continuation downmove toward 1.3300-1.3400.
GBPUSD ended the week lower as the 89-pip upside attack through the 1.6900 last Wednesday has been extinguished completely by declines seen on Thursday and Friday. Sellers sent the pair back below 1.6900 and closed the week in the 1.6830s. Bulls need to stop this and defend the 1.6800 level. Otherwise, GBPUSD could run the risk of moving below 1.6600-1.6700 again in the coming weeks.
USDJPY secured its first bullish weekly close this week thanks to three straight daily gains up until Friday. The pair made a dash northward on Wednesday after price bottomed out at the low-100.80s. The dash higher fell short of closing above the 102 level, though. Next week, this pair needs a strong close above the 103 and attack potential sellers in the mid-104s.
The Week Ahead
Monday will again be a very brief news day as the UK will observe the Spring Bank Holiday, while the United States observe Memorial Day. Critical news to watch out for today will be New Zealand’s Trade Balance; BOJ Monetary Policy Meeting Minutes; Gfk German Consumer Climate; and ECB President Draghi’s speech.
Tuesday will start during the European session with Switzerland’s Trade Balance and Employment Level; UK BBA Mortgage Approvals; US Durable Goods Orders, S&P/CS Composite-20 HPI, CB Consumer Confidence, and Richmond Manufacturing Index.
BOJ Kuroda’s speech will open up Wednesday’s Asian session, followed by the release of New Zealand’s ANZ Business Confidence; Australia’s Construction Work Done; France Consumer Spending; Germany’s Jobless Change; Eurozone M3 Money Supply; Spain’s HPI; and UK CBI Realize Sales.
Thursday will start quite early with Japan’s Retail Sales; Australia’s Private Capital Expenditure; Canada’s Current Account; US Preliminary GDP, Jobless Claims, and Pending Home Sales. France, Switzerland, and Germany will observe Ascension Day.
This coming Friday, we will have New Zealand’s Building Consents; Japan’s Household Spending, Prelim Industrial Production, and Tokyo Core CPI; Germany’s Retail Sales; Canada’s GDP and RMPI; US Core PCE Price Index, Personal Income, Personal Spending, Chicago PMI, and Revised UoM Consumer Sentiment.
