GERMAN IFO, US HOUSING DATA IN FOCUS ON TUESDAY
A steady stream of economic data will make its way through the markets on Tuesday, with headline reports from Europe and the United States set to capture investors’ attention.
The economic calendar begins at 06:00 GMT with a report on Switzerland’s trade balance. The nation’s surplus is forecast to widen in March thanks to higher exports.
CESifo Group will report on German business confidence at 08:00 GMT. The business climate indicator for April is projected to weaken sharply to 102.6 from 114.7 the month before. The gauges for the current economic climate and future expectations are also expected to fall.
Shifting gears to New York, the S&0/Case-Shiller Home Prices Indices are scheduled for release at 13:00 GMT alongside the FHFA housing price index. Both indicators are expected to show positive growth in home prices.
Meanwhile, the Department of Commerce will issue its monthly report on new home sales, which is expected to show a gain of 1.9% month-on-month.
Wrapping up the data wire is the Federal Reserve Bank of Richmond, which is scheduled to release its manufacturing index at 14:00 GMT. The monthly gauge is expected to improve to 16 from a reading of 15 the month before.
Earlier in the day, the Reserve Bank of Australia reported headline inflation numbers that deviated slightly from met analysts’ forecasts. The consumer price index (CPI) rose 1.9% annually in the first quarter, unchanged from Q4. The Trimmed Mean CPI rose by a similar amount, compared with 1.8% the previous quarter.
In currency news, the US dollar surged on Monday to its highest level in over three months, as rising interest rates boosted the appeal of the greenback. The US dollar index (DXY) reached a high near 91.00 after gaining 0.7%.
Europe’s common currency declined sharply on Monday, following the path of other dollar crosses. EUR/USD fell to the low 1.2200s and was last seen trading at 1.2210. The pair is down nearly 200 pips over the last three trading sessions. Immediate support is located at 1.2190. On the flipside, resistance is likely found at 1.2260.
Cable’s meteoric decline continued Monday, with prices now falling more than 400 pips from last week’s multi-year high. At the time of writing, GBP/USD was trading at 1.3941, where it risks an even bigger pullback. The pair now faces immediate support at 1.3900. The initial resistance is found at 1.4130.
Like other dollar pairs, AUD/USD crashed hard on Monday, falling to the low 0.7600 range. The Aussie is now trading at its lowest level since December. Immediate support levels include 0.7600 and 0.7565. On the opposite side of the ledger, resistance is located at 0.7640 and 0.7675.