FRANCE: The Irish Times notes that the planned French "super tax" on the wealthy
will be applied to all companies, including soccer clubs and their players.
GREECE: The Greek privatisation agency has picked p the pace of its programme
ahead of the forthcoming visit by Troika officials, eKathimerini reports.
IRELAND: There are signs of a return of confidence for Irish SMEs, the Irish
Independent says, with the latest ISME survey showing a broad increase in
sentiment across the board.
UK PRESS: The Times Shadow MPC meets and Michael Saunders, Citigroup chief
economist, renews his calls for increased QE, saying the stock should be
increased by stg 50 bn to stg 425 bn,
UK PRESS: Speaking Tuesday, Downing Street officials said the UK minimum wage
would not be cut, but said they could not guarantee the level would not be
frozen, the Telegraph says.
UK PRESS: The Telegraph says Germans are increasingly moving to owner-occupation
over renting their properties, encouraged by high rents and low mortgage levels.
FED: Comments from Richmond Fed's Lacker:
-US LIKELY NOW HAS LOWER TREND REAL GDP
-NOT CONVINCED MON POL CAN GROW ECON BACK TO 2.5% TREND
-UNCERTAINTY OVER HEALTH REFORM FREEZING ACTIVITY
-HOUSEHOLDS REBALANCING, MORE RISK AVERSE
-WARNS VS COMPLACENCY ON INFL GIVEN LOW EXPECTATNS
-SEE UPSIDE RISKS STARTING 1-1/2 TO 2 YEARS
-POL EXIT MORE RISKY WITH MORE ASSET PURCHASES
-NOT CONVINCED CAN DIAL BACK INFL EXPECTNS WHEN WE WANT
-FISCAL POL COULD REALLY COMPLICATE MON POL
FED: More from Chicago Fed's Evans:
- AVG INFL GOAL 2.5% SO CAN EVEN GO SLIGHTLY ABOVE
- CAN KEEP EASY POL AS LONG AS INFL EXPECT BELOW 2.5%
- CAN KEEP ZERO RATE EVEN IF 'BLOW PAST' 6.5% UNEMP
- STILL HAVE A LOT OF WORK TO DO ON POLICY GOALS
- STILL VERY FAR AWAY FROM POLICY BULLSEYE
-NOT SEEING ANY SIGNS OF WAGE PRESSURES ON INFL
-SHOULD DEAL W/ENTITLEMENTS OVER APPROP HORIZON
KOREA: Media reports say North Korea has blocked South Korean workers from
entering the Kaesong joint industrial complex, another sign of rising tensions.
EURO-DOLLAR: Closed in NY Tuesday at $1.2820 after rate had been pressed to
eventual intraday lows of $1.2808 before recovering to $1.2827 ahead of the
close. Early Asia took rate back to retest that $1.2827 level before turning
lower again, the dollar enjoying another round of general demand (apart from vs
the Australian dollar which bucked the trend on the back of strong domestic
trade data and strong China non-mfg PMI) as markets traded with a slight risk
off tone, tracking ex-Japan equity markets. Rate squeezed below Tuesday's low,
breaking under $1.2800 to post overnight lows at $1.2795, before slowly climbing
back through the Asian afternoon to the $1.2810 area into Europe. Corporate
demand again reported below $1.2800 and seen providing some cushioning, though
rate retains an underlying heavy tone as markets keep focus on Thursday's ECB
rate decision/Draghi press conference, with Friday's key NFP lurking in the
background. EZ CPI due at 0900GMT in an otherwise data light Europe calendar
with attention set on US ADP data at 1215GMT and US non-mfg ISM at 1400GMT.
Corporate demand from $1.2795 through to stronger area of $1.2755/50. Resistance
into $1.2830, then $1.2845/55 ahead of strong interest above $1.2880.
EURO-DOLLAR: Back below $1.2800 but seen struggling to grind below the overnight
base sat $1.2795. Rate has managed to extend lows to $1.2794 but seen meeting
decent demand though this interest not enough so far to produce a decent
recovery attempt. Corporate demand has been mentioned again in place below
$1.2800, with interest seen dotted down to the mid $1.26's. Apart from this
interest there are bids seen congregating between $1.2780/70, with stronger
interest remaining ahead of barrier interest at $1.2750. Stops are noted below
this level.
EURO-DOLLAR: Fundamental levels (orders, options, technicals)
$1.2930/50 Medium offers/Stops
$1.2920 Medium offers
$1.2900/10 Medium offers/Stops
$1.2880/90 Medium offers/$1.2890 200-dma/Stops $1.2885 mixed in
$1.2878 Tuesday Apr2 high
$1.2845/50 Medium offers
$1.2827 Int.Day high Asia
$1.2798 ***Current mkt rate 0605GMT Wednesday
$1.2795 Int.Day low Asia
$1.2780/70 Medium demand/Corporate interest noted
$1.2755/50 Strong demand/$1.2750 barrier/Stops
$1.2735/25 Medium demand/Stops mixed in below $1.2730
$1.2700 Option barrier/Strong bids ahead
$1.2680 Tech 61.8% $1.2043-1.3711
$1.2662 Tech Nov13 2012 low/$1.2043 July24 2012 low
CABLE: Closed in NY Tuesday at $1.5104 after the rate had come under pressure
through the NY session, breaking support in the $1.5170/80 area before posting
lows at $1.5099. Rate consolidated Tuesday's losses between $1.5104/10 through
the Asian morning before rate came under another round of sell pressure which
extended lows to $1.5075 before it settled between $1.5077/87 ahead of the
European open. Euro-sterling, which had eventually broken resistance at
stg0.8475/85 Tuesday posted highs in NY at stg0.8494, with rate consolidating
this recovery between stg0.84835-0.8492, leaving cable to track euro-dollar
moves. Cable bids seen into $1.5070, with talk of decent sized stops below. A
break to open a deeper move toward $1.5050/40 ahead of $1.5027 (Mar20 low).
Resistance remains at $1.5110, a break to open a move back toward $1.5125/35
ahead of $1.5150. Euro-sterling offers seen into stg0.8500, support
stg0.8475/70. Focus today will be on release of UK construction PMI data at
0830GMT, with forecasts suggesting an improvement toward 48.0 from 46.8 last.
BOE Credit Conditions Survey follows at 0930GMT.
CABLE: MNI Cable: Fundamental levels (orders, options, technicals),
$1.5280 Strong offers on approach/Monday Mar25 high
$1.5259 Tuesday Apr2 high
$1.5230/35 Medium offers
$1.5190/2.00 Strong offers
$1.5150 Medium offers
$1.5120 Medium offers
$1.5110 Int.Day high Asia
$1.5082 **Current market rate 0712GMT Wednesday
$1.5075 Int.Day low Asia (NY $1.5099)
$1.5070 Medium demand/Larger stops
$1.5042 UK Budget react low (Wed Mar20)/Bids $1.5050-40
$1.5027 Wednesday Mar20 low
YEN: Dollar-yen closed in NY Tuesday at Y93.43 after rate had extended its
recovery off earlier Asian lows of Y92.57 to Y93.56. Rate drifted off to Y93.32
before turning higher, the move up acting on a strong Nikkei which took it on to
a high of Y93.69. Euro-yen moved up in tandem but met stiff resistance on
approach to Y120.00, with macro and momentum funds the stand out sellers. The
two day BOJ meeting began today with Thursday's announcement providing
anticipation for strong action based on new BOJ Kuroda's determination to do
'whatever is necessary' to eradicate deflation, committing to reach 2.0%
inflation within 2-years. Until the announcement market expecting yen to
consolidate, taking next direction from the planned initiatives. Traders have
suggested that with this high anticipation the market could be leaving itself
open to disappointment but would look to buy any dips in yen pairs on the
expectation that the BOJ will be determined to take action over the next few
months.
JAPAN STOCKS CLOSE: Japan's benchmark stocks are trading sharply higher
Wednesday. The Nikkei 225 was higher by 358.77 points, or 2.99%, at 12362.20.
Into the close, the broader-based TOPIX was higher by 15.87 points at 1007.21.
Market breadth indicators saw 139 issue higher, 71 lower and 15 unchanged.
Preliminary volume stood at 2.012 bn shares.
GOLD: Spot gold now trades down $5.13 at $1,570.77 per ounce, in a $1,570.65 to
$1,577.20 range. Despite jitters about the crisis in Cyprus since mid-March, the
precious metal only just managed to break above $1,600/oz before stalling below
key resistance seen around the $1620/27 region. Price action this week has seen
gold slipping below March 14 lows near $1,577.14 and looks set to test the March
8 lows near $1561.48, which if broken, will target the lows near $1,555 seen Feb
21. "Gold has failed to rebound significantly despite a rise in risk aversion,
which may explain why investor interest in the precious metal has remained
subdued," commented strategists at BNP Paribas. "We will unlikely see a durable
rebound in gold managed money futures positioning until market expectations
settle regarding the duration of QE3."
OPTIONS: FX: Option expiries for today's 1000ET cut,
* Euro-dollar; $1.2750, $1.2780, $1.2850, $1.2860, $1.2900, $1.2995
* Dollar-yen; Y93.00, Y93.50, Y93.70, Y94.00, Y95.00, Y96.00
* Euro-yen; Y120.70, Y121.00
* Cable $1.5000
* Aussie; $1.0450
EUROZONE ISSUANCE: Sovereign bond issuance in the eurozone slows down this week
and is only scheduled from France, Germany and Spain -- expected to total
E15.0bln. Germany kicks off supply on Wednesday with re-opening of its 5-year
benchmark 0.50% Feb 2018 Bobl issue for up to E4.0bln. On Thursday, Spain sells
a new 3-year benchmark 3.30% July 2016 Bono and taps its 4.10% July 2018
Obligacion and also 5.50% Apr 2021 Obligacion issues for between
E3.0bln-E4.0bln. Also on Thursday, France conducts its regular OAT auctions,
where the AFT tap its 10-year benchmark 2.25% Oct 2022 OAT and also off-the-run
OAT issues 3.50% Apr 2020 OAT and 3.75% Apr 2021 OAT issues for combined size
of between E6.0bln-E7.0bln. In terms of reinvestment flows, there are no
redemptions due and minor coupon payments from Italy E0.22bln and Spain E0.11bln
-- to leave net cash flow negative to the tune of E14.7bln versus -E1.2bln last
week. For full details of forthcoming issues, please see eurozone bond auction
calendar & MNI Eurozone Net Cash Flow Matrix.
EUROZONE T-BILL ISSUANCE: Eurozone sovereign T-bill issuance has been completed
for this week, with E13.588bln allocated by Netherlands, Belgium and France. To
recap, on Tuesday Netherlands sold E1.27bln 3-month Jun 28 DTC at average yield
-0.025% and sold E1.32bln 9-month Dec 30 DTC at average yield 0.000%. Belgium
sold E1.406bln 3-month Jul 18 TC at average yield 0.027% and sold E1.61bln
6-month Sep 19 TC at average yield 0.05%. In the afternoon, France sold E3.995
3-month Jul 4 BTF at average yield 0.015%, E0.995bln 6-month Sep 5 BTF at
average yield 0.026%, E0.996bln 9-month Dec 12 BTF at average yield 0.031% and
E1.996bln 12-month Apr 3, 2014 BTF at average yield 0.086%. T-bill issuance is
expected to pick up next week with plans from Germany, France, Italy, and Greece
and is expected to total E20.5bln.
EUROZONE: Timeline of key events in the eurozone for next few weeks:
- Apr 3 EU Barroso press conference with Czech President Zeman
- Apr 3 ECB settles E3.845bln in 1st LTRO; E3.16bln in 2nd LTRO
- Apr 4 ECB Governing Council meeting, Draghi press conference
- Apr 4 Eurogroup chair Dijsselbloem speaks in Dutch parl on eurogroup meet
- Apr 4 Spain sells new 3-yr 2016 Bono and taps 2018-/2021 Oblig bonds
- Apr 5 ECB publishes its 3-year LTRO repayment amount for following week
- Apr 7 Italian March Target 2 data and central bank lending figures
- Apr 8 ESM Regling speaks at FDEF Conference on "Is the Euro crisis over?"
- Apr 10 Italy T-bill auction
- Apr 11 Eurogroup meeting in Dublin
- Apr 11 Spanish March Target 2 data and central bank lending figures
- Apr 12/13 Informal ECOFIN meeting in Dublin
- Apr 12 Italy T-bill redemption for E8.8bln
- Apr 15/16 Economist 17th Roundtable with Government of Greece
- Apr 15 Italy joint session of parliament called to elect new President
US: Timeline of some upcoming key events in the US:
- Mar 25-Apr 5 Congressional Easter/Passover recess
- Apr 02 Fed Evans (voter) on monpol in Richmond at 1930ET
- Apr 03 Outright T Coupon Purch 01/31/2019-03/31/2020 $3-$3.75b
- Apr 03 Fed Williams (non-voter) at Town Hall in Los Angeles at 1430ET
- Apr 03 Fed Bullard (voter) reporter briefing in St. Louis at 1600ET
- Apr 04 Fed Evans (voter) & Fed Lockhart (n-v) in Ohio at 0845ET
- Apr 04 Outright T Coupon Purch 02/15/2036-02/15/2043 $1.25-$1.75b
- Apr 04 UST announces 3/6m bills, 3-10-30y coupons at 1100ET
- Apr 04 Fed George (voter) in Oklahoma at 1230ET
- Apr 04 Mar Treasury STRIPS at 1500ET
- Apr 04 Money Supply (M2) at 1630ET
- Apr 04 Fed Vice Chair Yellen at SABEW conf in Washington at 1700ET
- Apr 05 Mar Non-farm Payrolls-est +195k/+0.2% AHE at 0830ET
- Apr 08 Tsy Lew in Brussels, then meets w/ ECB Pres Draghi in Frankfurt
- Apr 09 Tsy Lew meets w/ German and French FinMins in Berlin and Paris
