EUR/USD: economic mood in the eurozone improved to 43.9 points
The EUR/USD currency pair is showing moderate strengthening, recovering from a strong bearish trend that began last week and led to an update of the minimum values since November 2 of the previous year. The pair has now tested the 1.0625 level, waiting for new catalysts to move.
The euro is supported by the latest data from the Center for European Economic Research (ZEW): the index of economic sentiment in the eurozone increased from 33.5 to 43.9 points in April, which significantly exceeded analysts' expectations of 37.2 points and was the highest result since the spring of 2022. This strengthens expectations of an improvement in the economic situation in the next six months. In addition, the region's trade balance showed a surplus of 23.6 billion euros, almost doubling compared to January, due to an increase in exports of cars and equipment, as well as due to a decrease in energy imports. Today, data on the German wholesale price index for March were also presented, which remained at the level of 0.2% monthly growth, which exceeded analysts' expectations for a decrease to -0.1%, and the annual figure was -3.0%.
- Resistance levels: 1.0630, 1.0660, 1.0700, 1.0730.
- Support levels: 1.0600, 1.0561, 1.0530, 1.0500.
USD/JPY: stabilization at historically high levels
The USD/JPY currency pair shows mixed trends, holding near the level of 154.60. Buyer activity remains significant, but new positions are being opened cautiously in anticipation of potential interventions from the Bank of Japan. The regulator expressed concern about the speculative weakening of the yen, which, despite the recent interest rate increase, did not lead to a strengthening of the currency due to bias towards a soft monetary policy. Japanese Finance Minister Shunichi Suzuki confirmed that the monetary authorities are ready for decisive measures to stabilize the yen.
Support for the Japanese currency also came from trade data for March: exports increased by 7.3%, despite a slight slowdown compared to February, and imports decreased by 4.9%, resulting in a trade surplus of 366.5 billion yen. In the US, on the contrary, the March data on the construction sector turned out to be less satisfactory: building permits fell by 4.3%, and the start of new construction decreased by 14.7%, which further weakened the dollar against the yen.
- Resistance levels: 155.00, 155.50, 156.00, 156.50.
- Support levels: 154.50, 154.00, 153.50, 153.00.
USD/CAD: US dollar continues to dominate the currency pair
The USD/CAD currency pair is experiencing a correction, stabilizing at 1.3820 amid the activity of the US dollar and ambiguous Canadian economic statistics.
March inflation data in Canada showed a 0.6% monthly increase in consumer prices and an increase in the annual index from 2.8% to 2.9%. However, the base index excluding food and energy prices showed a 0.5% monthly change and a decrease from 2.1% to 2.0% per annum, which was in line with market expectations.
On the other hand, the US dollar reached a high level of 106.10 on the USDX index, which was confirmed by retail sales data. Sales in the United States increased by 0.7% monthly in March, exceeding analysts' expectations of 0.4%, and accelerated significantly year-on-year from 2.11% to 4.02%. Underlying sales also showed an increase from 0.6% to 1.1%. In addition, industrial production increased by 0.4% on a monthly basis and recovered to the level of 0.00% per annum after a previous decrease of 0.30%, which adds dynamism to the US dollar in the market.
- Resistance levels: 1.3850, 1.3960.
- Support levels: 1.3780, 1.3610.
GBP/USD: analysis for the quarter
We present an analysis of the investment prospects of the GBP/USD pair for the medium term.
The UK continues to experience economic difficulties caused by persistently high inflation. The actions of the Bank of England to stabilize it have not yet brought the expected result, and the current fluctuations in the pound are due to falling electricity prices on the stock market. Nevertheless, given the recent rise in oil prices, it is possible that the value of the pound will resume rising. The interest rate set by the regulator at 5.25% is likely to be supported at the next meeting on May 9, according to experts' forecasts. The consumer price index in March showed a decrease to 3.2% from 3.4%, and the main index excluding the cost of food and fuel remained at 4.2%. The pound is also feeling pressure from the retail sector: the core retail sales index increased by only 0.2% in February after rising by 3.4% a month earlier and fell by 0.5% in annual terms after an increase of 0.5% in the previous month. At the same time, the volume of retail sales in February remained unchanged, which led to an annual decline of 0.4%, and the GDP indicator for the same period decreased from 0.3% to 0.1%.