Daily FX Update, 17 April 2015 OVERNIGHT MARKET UPDATE: ·

OVERNIGHT MARKET UPDATE:

·         US March housing starts disappointed markets’ expectations, rising 2.0% m/m to 926k following the sharp weather-related 15.3% m/m plunge recorded in March. Building permits also weakened, falling 5.7% m/m. Overall, the trend in housing market data points to only a gradual improvement in activity.  

·         US Initial jobless claims rose modestly to 294k from 282k. Nonetheless, the four-week average of 283k is a 15 year low, and remains consistent with strong employment growth and further declines in the unemployment rate.

·         The Philadelphia Fed survey rose to +7.5 in April from +5 in March. The details of the survey were also encouraging with the employment and shipment components improving. Furthermore, the six-month outlook component also picked up for overall activity and employment.  

·         In euro area, press reports that the IMF had rejected an informal request for the Greek government to delay its loan repayments precipitated some sharp moves in euro area sovereign bond markets.  

·         In the currency market, USD selling remains the theme despite a pick-up in the April Philly Fed survey. The AUD broke through important resistance after the stronger domestic employment data and will likely extend a bit higher.     

·         US Treasuries rallied initially, but these moves were erased later in the session following the better Philadelphia Fed survey. US 10-year Treasury yields were essentially unchanged at 1.88%.           

·         US bourses ended largely unchanged. Reuters reports that of the 51 S&P 500 companies that have reported thus far, more that 75% exceeded profit expectations, but less than half of companies exceeded revenue forecasts.     

·         Crude oil markets were firmer, with Brent prices outperforming WTI. Brent prices hit a new 2015 high as the conflict in Yemen increased the geopolitical risk in oil.         

Gold prices ended marginally lower after regional U.S. data showed stronger-than-expected business activity this month. The gold prices closed 0.03% lower to US$1,196.7 per ounce from the previous closing.