DATA DELUGE CONTINUES ON WEDNESDAY
The global data dump will continue mid-week, with reports from the United States and Europe set to make headlines. Monetary policy is also on the agenda with speeches from ECB and Federal Reserve officials scheduled throughout the day.
Action begins at 06:00 GMT with a report on German inflation. Consumer prices in Europe’s largest economy are forecast to rise 1.6% annually in April. The harmonised index of consumer prices (HICP), which calculates inflation using a method consistent throughout the EU, is expected to rise 1.4% year-over-year.
Over the next three hours, investors can anticipate a pair of Italian reports focused on industrial orders and consumer inflation. Italy’s consumer price index likely rose 0.5% year-over-year, forecasts show.
The European Commission’s statistical agency will report on final Eurozone inflation at 09:00 GMT. Consumer price growth in the 19-member euro area likely rose 1.2% in the 12 months through April.
On the monetary policy docket, European Central Bank (ECB) President, Mario Draghi, is set to deliver a speech at 12:00 GMT. ECB members Benoit Coeure and Peter Praet are also scheduled to speak later in the day.
In terms of North American data, the US Commerce Department will report on housing starts and building permits at 12:30 GMT. Both data sets are projected to show weakness for the month of April.
Forty-five minutes later, the Federal Reserve will release its monthly industrial production report. Output at US factories, mines and utilities facilities likely rose 0.5% for April.
Commodity traders will also be keeping close tabs on the weekly crude inventory report from the US Energy Information Administration (EIA). The data set is scheduled to come our way at 14:30 GMT.
Two Federal Reserve officials are scheduled to deliver speeches on Wednesday, including Federal Open Market Committee (FOMC) member Raphael Bostic. James Bullard, who heads the St. Louis Fed, will deliver public remarks at 22:30 GMT.
Europe’s common currency staged a failed recovery on Tuesday as the US dollar rose to fresh five-month highs. EUR/USD peaked near 1.2000 but has since fallen all the way back to 1.1831. The pair is beholden to economic data with the bulls struggling to hold support above 1.1822.
Cable continued to lose its luster Tuesday, as prices briefly fell below 1.3500. GBP/USD was last seen trading at 1.3504. Immediate support is located at 1.3459, which is the intraday low from Tuesday.
The USD/JPY reached an important milestone on Tuesday, as prices broke sharply above 110.00 for the first time since February. The rally extended toward 110.50 before a broad pullback dragged prices back down to 110.30. Immediate support is located at the psychological 110.00 level, although it remains to be seen whether the greenback can sustain its recent bout of good fortune.