Daily FX Update, 8 April 2015 OVERNIGHT MARKET UPDATE: ·

OVERNIGHT MARKET UPDATE:

·         In US, job openings rose to 5.13m in February up from 4.97m in January, the highest level since January 2001. These data, in conjunction with other labour market indicators, suggest that the US labour market remains on a solid footing.  

·         Minneapolis Fed President Narayana Kocherlakota, a noted dove, stated that it would be a “mistake to raise the target range for the fed funds rate in 2015. 

·         In Euro, the final composite PMI for March was revised marginally lower to 54.2 from 54.3. Overall, the modest cyclical upswing in the euro area has continued to gain traction, responding to ECB stimulus, lower oil prices and reduced fiscal drag.   

·         In UK, minutes from the Bank of England’s Financial Policy Committee meeting noted that some members remained concerned over the size of the UK’s current account deficit.

·         In the currency market, the USD was in broad ascendancy overnight, as markets focused on a wider array of indicators, such as JOLT jobs, that suggest the weak payrolls data should be looked through. Despite losing ground to the USD, AUD broadly held onto gains on crosses post the RBA.  

·         US Treasuries sold off across the long end of the curve ahead of the US$24 billion 3-year note auction, with 10-year yields having erased their post-payrolls moves.  

·         After seeing moderate strength for much of the session, US equities came under pressure going into the close of trading on Tuesday. The pullback on the day came on the heels of the rebound that was seen over the course of the previous session, with the major averages closed lower from the previous closing.

·         Crude oil prices rallied continuing to find support from demand side factors, this time from a surge in US jobs data. The smaller rate of increase in inventories and falling rig count is also raising speculation that production may soon curb.  

Gold retreated overnight on the back of the USD strength. Gold prices closed 0.68% lower to US$1,211.40 per ounce from the previous closing.