IronFX | Mar 25, 2014 09:09AM ET
US interest rate expectations continue to edge higher post-FOMC, but the dollar is losing ground nonetheless as fears over Ukraine recede and short-term rates in many other countries rise as well, albeit not by as much as they have in the US. The implied interest rates on Fed Funds futures continued to move higher, as did 5-year yields (although 10yr Treasury yields are below their post-FOMC highs). Fears of higher policy rates seem to be affecting US stocks and gold, which declined, yet the dollar isn’t getting much support. Worries about Ukraine are receding as US Secretary of State Kerry holds meetings with his Russian and Ukrainian counterparts and a survey of Germans showed a majority think the West should accept Russia’s annexation of Crimea.
From the UK, the nation’s CPI is expected to have risen 0.5% mom in February vs -0.6% mom in January, driving the yoy rate down to 1.7% from 1.9%. BBA mortgage approvals for February are expected at 50000, not much of a change from 49972 in January.
In the US, the Federal Housing Finance Agency (FHFA) house price index and the S&P/Case-Shiller home price index for January are expected to show a slowdown in the pace of increase in house prices. New home sales are expected to have declined in February, after rising in January. The Conference Board consumer confidence index for March is expected to have risen to 78.5 from 78.1 in February, while the Richmond Fed manufacturing survey for the same month is expected to be up to 4 from -6. This mix of indicators is overall slightly US-positive, although sentiment may prove stronger than facts in determining the course of the currency.
Two speakers are scheduled on Tuesday. ECB President Mario Draghi and Atlanta Fed President Dennis Lockhart.
h3 The Market/h3EUR/USD
Support: 1.3810 (S1), 1.3770 (S2), 1.3715 (S3).
Resistance: 1.3880 (R1), 1.3965 (R2), 1.4000 (R3).
h3 USD/JPY/h3Support: 101.85 (S1), 101.25 (S2), 100.75 (S3).
Resistance: 102.70 (R1), 103.40 (R2), 103.75 (R3).
h3 EUR/GBP/h3Support: 0.8340 (S1), 0.8300 (S2), 0.8260 (S3).
Resistance: 0.8400 (R1), 0.8460 (R2), 0.8535 (R3).
h3 Gold/h3Support: 1310 (S1), 1290 (S2), 1265 (S3).
Resistance: 1325 (R1), 1342 (R2), 1354 (R3).
h3 Crude Oil/h3Support: 98.30 (S1), 97.30 (S2), 96.50 (S3).
Resistance: 100.00 (R1), 101.00 (R2), 103.00 (R3).
BENCHMARK CURRENCY RATES - DAILY GAINERS AND LOSERS
MARKETS SUMMARY
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