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Week in FX Europe April 15-20

Euro bond auctions dominated this week’s proceedings. German product, with the ultra-low yields, is beginning to struggle to attract strong demand but is unlikely to have a strong effect on the EUR. Why? With the desirable Bunds, investors in this environment tend to prioritize safety over returns. Capital Markets main ‘squeeze’ has been Spain. After passing this week’s 2 and 10-year litmus test, Spain has now managed to place more than +50% of its likely issuance for the year. Does this rule out a Euro systemic funding crisis happening in the near term? The answer is ‘probably’, nevertheless, weak data and rising non-performing loans would indicate further easing bias from the ECB. However, despite the week ending on strong data surprises in the UK and Germany, a dovish bias cannot be supportive for the single currency.

Below are some other highlights of the week:


EUROPE

 

AMERICAS Week in FX [1]

ASIA Week in FX [2]

 

WEEK AHEAD

  • Week starts with CNY flash PMI and Aussie CPI and PPI
  • CAD quiet with Core retail sales
  • USD, JPY and the Kiwi’s bring us CBank rate announcements
  • New and Pending Home sales are delivered to us from the US
  • GBP gives us preliminary GDP while the US advance
  • In mid-week we get to see consumer confidence in the US

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Dean Popplewell

Dean Popplewell [7]

Vice-President of Market Analysis at MarketPulse [8]
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell
Dean Popplewell

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