US dollar was weighed last night by dovish comments on US economy included in the FOMC meeting minutes. There were different views among Fed officials concerning the slack in economy and employment sector outlook was not clear. The greenback lost across the board against its major peers with the US dollar index dipping lower than 79.67 to 79.40, exposing March lowest at 79.24.
The Australian dollar was well supported by much better employment data. Unemployment rate declined for March to 5.8%, surprisingly lower than expected at 6.1%. Thus, the AUDUSD jumped from 0.9344 to as high as 0.9440 in the recent trading, holding well in its uptrend style.
Chinese Trade Balance has improved surprisingly to surplus of $7.7 billion in March compared to -$23.0 billion deficit in February. However, that was a result of declining Exports and Imports. Exports declined by 6.6% compared to 2013 March and imports reduced by 11.3% in comparison to one year ago. That has eventually provided support to the Japanese Yen. The USDJPY retests previous support at 101.60 and should it breach that would head towards 101.18.
The Bank of England monetary policy committee meets today to decide on policy. Economists are widely expecting that key rate will stay at 0.5% and asset purchase facility will also stay at 375B. The GBPUSD has been trading in sideways in intraday below cap at 1.6820. Should the policy remain the same there will be no BOE statement release and due to strong resistance we may see some retracement. Lastly, investors are expecting Italian Industrial production data and ECB Monthly Bulletin which reports activities of the European System of Central Banks. The Euro against the greenback is characterized by upside bias, rising early today to 1.3869 and is likely to continue on that direction.
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