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Forex Flash: The real economic news today comes from Europe - BBH

FXstreet.com (Barcelona) - Brown Brothers Harriman analysts note that German, French and Italian GDP reports were weaker than the consensus.

They see that Germany managed to eke out a 0.1% expansion, though the market had been looking for a 0.3% expansion. Q4 contraction was revised to 0.7% rather than 0.6%. France contracted by 0.2% rather than 0.1% and Q4 GDP was revised to -0.2% from -0.3%. Italy contracted by 0.5%. The consensus was for a 0.3% contraction. They note that the Italian economy has contracted now for seven consecutive quarters and the eighth one appears to be under way. France reported much lower than expected inflation of 0.8% y/y in April, and mirrors the trends seen in Germany and the wider euro zone. The mix of slower growth and further disinflation (moving towards outright deflation) will surely fan expectations of further ECB actions, which Draghi has pledged it stands ready to do. They finish by writing, “We believe the ECB has entered string-pushing territory, but at the very least, market reaction (selling the euro) should help the euro zone economy at the margin, perhaps more than another symbolic cut in the refi rate would. A weaker euro is needed now, not a stronger euro.”

Forex: AUD/NZD making fresh yearly lows to 1.2004 offered

With plenty of negative sentiment for Australia, the bears in the market are enjoying a run on this pair to new fresh lows testing the 1.2000 handle in the US session.
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Forex Flash: 93.60 level looks to fortify recent drop in crude oil – RBS

Crude Oil prices reached the 93.6 support, formed by a Fibonacci retracement from the August- September 2012 impulse wave. However, “A negative crossover in the overbought 10/3/3 slow stochastic and a turn in 12/26/9 MACD oscillator suggest correction is looming to the 90.5 support region. Also it is worth noting that the price might be forming a head and shoulders pattern, with a target of 90/90.5.” suggests Dmytro Bondar, a Technical Markets Strategist at RBS.
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