Your forexlive.com ENewsletter

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• AUDUSD orders
• EURGBP orders
• AUDUSD below 0.9800 again
• Cable craps after UK data
• UK RPI april: m/m +0.3 % vs +0.5% exp
• UK CPI april: m/m +0.2 % vs +0.4% exp
• April UK PPI: Input -2.3% vs -1.1% exp. Output -0.1% vs 0.2% exp. M/M
• Big week for GBP/USD traders
• GBPUSD orders
• Wall Street Journal article: “Japan Ready for More Yen Weakness”
• European equity markets open mostly lower
• Berlin looks to scupper Cameron’s EU renegotiation plans
• EURUSD orders
• EURUSD rallies toward overnight highs
• AUDUSD extends its recovery
• Nikkei 225 closes up 0.13% at 15,381.02
• German PPI april: m/m -0.2 % vs -0.1% exp
• A slow start as we await German data at the top of the hour
• The Aussies are heading home
• CBI chief warns Cameron over tax avoidance rhetoric

AUDUSD orders Posted: 21 May 2013 01:56 AM PDT Sellers  0.9800 0.9810, 0.9825, 0.9840, 0.9850, 0.9860 Buyers  0.9770, 0.9750, 0.9730,0.9720, 0.9700 ( barrier option related)

EURGBP orders Posted: 21 May 2013 01:51 AM PDT The pair has just seen a quick jump higher after the UK inflation data. currently 0.8472 Sellers 0.8475, 0.8490,0.8500,0.8520,0.8535,0.8550 Buyers 0.8460,0.8450,0.8440,0.8430,0.8420,0.8400

AUDUSD below 0.9800 again Posted: 21 May 2013 01:45 AM PDT Earlier I posted that this pair was heading into strong sell interest at 0.9850. Currently back down  at 0.9793 just off 0.9786 lows

Cable craps after UK data Posted: 21 May 2013 01:42 AM PDT It’s a surprise to me. In chatting with Mike, his opinion is that the market sees that lower inflation gives the BOE room to cut rates. If so I reckon the market is talking out of it’s arse and as such have gone long at 1.5196. But the price is the price and GBP/USD has fallen through 1.5200 to a low of 1.5184. It’s a surprise to me as I’m coming from the angle that the lower inflation and especially the lower input/higher output prices means that there’s a better basis for growth which would negate the need for rate cuts. We’re also a long long way away from needing to adjust interest rates just because of inflation.

UK RPI april: m/m +0.3 % vs +0.5% exp Posted: 21 May 2013 01:30 AM PDT +0.4% prev y/y 2.9 %   +3.1% exp   +3.3% prev Both CPI and RPI lower than expected due largely to falling fuel costs The BOE’s MPC  suggest a rebound in May GBPUSD lower at 1.5187 from 1.5220. EURGBP up to 0.8467 from 0.8455

UK CPI april: m/m +0.2 % vs +0.4% exp Posted: 21 May 2013 01:30 AM PDT +0.3% prev y/y   +2.4% vs +2.6% exp   +2.8% prev The only notable upward contribution came from price movements for food & non-alcoholic beverages. This is the first time that the growth in inflation has slowed since Autumn 2012. Over the last six months, the CPI 12-month rate has been particularly stable. CPIH, the new measure of consumer price inflation including owner occupiers' housing costs, grew by 2.2% in the year to April 2013, down from 2.6% in March. The slower growth in CPIH than CPI is due principally to owner occupiers' housing costs increasing more slowly than overall inflation for other consumer goods and services in the year to April. Full report from the ONS here

April UK PPI: Input -2.3% vs -1.1% exp. Output -0.1% vs 0.2% exp. M/M Posted: 21 May 2013 01:30 AM PDT Input prior -0.1%. Revised to +0.1% Output prior 0.3% Revised to 0.2% Input y/y-0.1% vs 0.75% exp. Prior 0.4% Output y/y +1.1% vs 1.5% exp. Prior 2.0% Revised to 1.9%  Core output m/m 0.1% vs 0.3% exp. Prior 0.1% Core output y/y 0.8% vs 0.9% exp. Prior 1.3%

Big week for GBP/USD traders Posted: 21 May 2013 01:24 AM PDT Good morning all. A raft of UK figures out this week should give cable traders plenty to think about. We had improvements virtually across the board recently and the hope is that this is the start of some sort of recovery. Inflation is still above target but is expected to come down slightly to 2.6% from 2.8% at 8.30 gmt. While the headline CPI figure is important I’ll be keeping a closer eye on the PPI figure as this is the one that gives a better insight into price pressures. With oil’s fall this year we should see input PPI start to fall consistently. We are expecting to see input prices to fall by 1% to -1.1% from -0.1% previously with output prices falling by 0.1% to 0.2%. The rise in input prices has put pressure on margins as they have not been passed on in the output prices thus affecting companies profitability. Also the higher input prices make it harder for the UK market to compete with prices elsewhere. Although the falling pound make imports more expensive the UK can deal with currency moves better than prices out of it’s control. Retail prices are also expected to fall slightly to 3.1% from 3.3%. Again imported goods such as soft commodities has had the biggest affect on higher prices. A continuation of falling inflation and a further improving economic picture will push talk of further QE and rate cuts firmly away. Cable is obviously likely to rally if that happens. I wouldn’t hold cable longs looking for 3-400 pip moves as if the USD buying kicks in again it could knock us lower. That said cable could become more resilient to such moves as our overall picture improves. If there’s going to be any major sustained moves it’s more likely to show in EUR/GBP as we will be seen to be heading away from low growth faster than Europe and sterling will again be the place for the market to park it’s money.

GBPUSD orders Posted: 21 May 2013 12:50 AM PDT Falling back a little after its overnight rally to 1.5277. Currently 1.5240 Sellers  1.5275,1.5285,1.5300,1.5325,1.5350 Buyers 1.5225,1.5185,1.5175,1.5160,1.5150,1.5125

Wall Street Journal article: “Japan Ready for More Yen Weakness” Posted: 21 May 2013 12:32 AM PDT An article in the Wall Street Journal seems to give the green light to further yen weakness, countering market perceptions that have developed since the weekend that maybe yen weakness has run its course for now. Some pertinent lines from the article: Japanese policymakers are prepared for a further weakening of the yen, government officials said, despite the recent acknowledgement by Cabinet ministers that the excessive strength has largely been corrected. The officials said they aren’t concerned about the yen’s fall of more than 20% to around ¥102 to the dollar, … adding that “they are the rates set by the market.” (Remarks by Amari on Sunday and Suga last week) "aren’t meant to signal a desire to see the yen stabilize around the current level. “These remarks aren’t aimed at achieving a specific exchange rate or range,” one senior government official said." Another senior official added that the remarks by the cabinet ministers “won’t change the broader trend in the market.” One senior official stressed that “the weaker yen provides more benefits than harm for the economy overall,” playing down concerns about the effect on the economy of rising import prices. Just as a note, these officials quoted are not named in the article. Japan Ready for More Yen Weakness (The Wall Street Journal is often gated, so if you're unable to access the article try a a Google news search using the headline)

European equity markets open mostly lower Posted: 21 May 2013 12:06 AM PDT FTSE  -0.1% DAX -0.1% CAC40 -0.3% IBEX  0.0% FTMIB 0.0%

Berlin looks to scupper Cameron’s EU renegotiation plans Posted: 20 May 2013 11:55 PM PDT Despite Chanceller Merkel’s recent reported desire to keep the UK inside the EU it appears that Berlin is meanwhile making plans to thwart Cameron’s plans by stream-lining the decision making process The FT carries this story which is gated but available with a free registration. Try searching ” Berlin plans to streamline EU”

EURUSD orders Posted: 20 May 2013 11:40 PM PDT Currently back to 1.2887 after a brief flirt with 1.2900 just now Sellers 1.2905,1.2925,1.2935,1.2950,1.2970 Buyers 1.2865,1.2845,1.2820,1.2800,1.2790,1.2770

EURUSD rallies toward overnight highs Posted: 20 May 2013 11:22 PM PDT We’ve just seen an early European interest to buy on this pair stalling so far at 1.2900 just ahead of the overnight highs at 1.2904. There’s talk of stop-loss buying if 1.291o breaks to lead into more offers at 1.2925 and the large sell interest at 1.2950 that I reported yesterday

AUDUSD extends its recovery Posted: 20 May 2013 11:14 PM PDT The climb back over 0.9800 has signalled further buying and we’ve been heading in a straight-ish line toward the next big level at 0.9850 where I have previously reported large sell interest. Currently 0.9829 after 0.9836 highs

Nikkei 225 closes up 0.13% at 15,381.02 Posted: 20 May 2013 11:02 PM PDT down from its 15,388.37 intra day highs but still another highest close since dec 2007

German PPI april: m/m -0.2 % vs -0.1% exp Posted: 20 May 2013 11:00 PM PDT -0.2% prev y/y   -0.1%  vs +0.2% exp   +0.4% prev Slightly weaker than expected. EURUSD a touch lower at 1.2887

A slow start as we await German data at the top of the hour Posted: 20 May 2013 10:56 PM PDT All quiet so far again as Europe slowly rolls into action. German PPI is first up at the top of the hour with m/m -0.1% expectated vs -0.2% prev EURUSD currently at 1.2889, GBPUSD 1.5252, USDJPY 102.52, AUDUSD 0.9826

The Aussies are heading home Posted: 20 May 2013 10:45 PM PDT Seems like the UK is no longer the land of opportunity for you Aussies out there, given our tighter visa controls, weaker pound, and your higher wages back home. Sad really as I recall some great times down at Walkabout near Covent Garden ! The Independent carries this story Add: Mind you with the current AUD weakness, economic concerns at home, and not to mention the forthcoming Ashes series here I’d imagine a few will be sticking around for a while yet!

CBI chief warns Cameron over tax avoidance rhetoric Posted: 20 May 2013 10:38 PM PDT Following UK PM Cameron’s recent  rhetoric on tax avoidance the president of the Confederation of British Industry, Sir Roger Carr, has warned that  the attacks, essentially politically motivated, could do more damage than good for the UK. He has said that Mr Cameron shoud ” avoid the moral debate” and focus more on implementing policy. "As politicians pursue fairness, it is important that any criticisms are grounded in fact and hasty solutions or political point-scoring do not trigger long term unintended consequences. The CBI chief makes it clear he “does not condone abusive tax avoidance”  but that management should be left to choose what is acceptable within the legal framework. Full story from The Telegraph here

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