Key overnight events:
- ADP employment for March rose by 200,000, better than the estimated 195,000; this suggests that non-farm payrolls due Friday will come in around the vicinity of its moving average, reports Bloomberg.
- The Fed’s Evans, echoed Yellen’s dovishness, and said that monetary policy divergence will let FOMC hike more slowly. He sees a very shallow rate hike path and expects 2 hikes in 2016.
- The S&P 500 Index advanced 0.4%, extending gains sparked by Yellen’s speech on Tuesday. The index has erased its 2016 decline and is poised for a second straight quarterly advance. US dollar’s bearishness extended overnight, with the Bloomberg Spot Dollar Index ending 0.4% lower; with most commodity currencies extending their gains over the dollar.
- Front month crude futures eked a 0.1% gain after it pared gains back to $38/bbl after failing to trade above $40/bbl earlier in the session; EIA reported that weekly inventories continue to rise.
- German March CPI surprised to the upside, rising 0.8% month-on-month and 0.1% year-on-year, beating expectations of 0.6% and 0.1% respectively.
- Spot 1.3519
- USDSGD briefly traded below the key support of 1.3480, reaching a low of 1.3463 last night, the lowest since July last year.
- The Singapore dollar is poised for its largest monthly advance in more than 4 years against the US dollar.
- The ADB cut Singapore’s growth forecast for 2016 to 2.0%, down from the 2.3% estimate made in December.
- Spot 0.7643
- AUDUSD traded up to 0.7709 last night its highest level in 9 months, before paring back some of its gains this morning.
- Continued US dollar weakness looks likely to persist, and the next target for the currency pair lies above at 0.7800.
- Spot 1.2998
- GDP for January is scheduled to come in tonight at a gain of 0.3% month-on-month, up from the prior month’s 0.2%-rise.
- USDCAD rebounded off its 2016-low of 1.2924, as Canadian dollar’s strength against the US dollar was slightly muted due to recent crude oil weakness.
- Finance Minister Morneau commented the loonie remains low by historical standards and will be continued to be influenced by oil prices.
- Spot 6.4722
- China is set to post its final reading of its 4Q current-account balance today; the prior figure was US$84.3 billion.
- Key PMI figures for March are scheduled to be released tomorrow with manufacturing PMI expected to come in at 49.4, up from 49.0 previously.
- The PBOC set its reference rate 0.35% higher today, the highest since 15th Dec; USDCNH slipped to as low as 6.4685 this morning, its lowest in a week.
- Spot 8.3215
- Unemployment rate in January came in at 4.8%, higher than the 4.5% expected while the previous figure was revised higher by 0.1% to 4.6%; unemployment is currently at its highest since 2005.
- USDNOK traded momentarily below its 2016 low of 8.3029 last night. The next support to the downside lies around 8.1000 region.