Forex Major Currencies Outlook (April 28, 2014)

The UoM consumer sentiment figure for April was revised higher to reflect more optimism in the economy while the flash services PMI for the same month fell short of expectations and showed a slower expansion in the sector. Only the pending home sales report is due today and a 1.0% rebound is eyed to follow the previous 0.8% decline.

EUR

The euro edged slightly higher to the dollar on Friday but opened weaker this week. There were no reports released from the euro zone then but the risk-off environment spurred the worsening tension in Russia and Ukraine led to a poor showing for the higher-yielders. German import prices data is due today but this might not have such a huge impact on euro movement.

GBP

The pound was unable to sustain its rallies past the 1.6800 major psychological level as traders booked profits off the key resistance area. UK retail sales were stronger than expected at 0.1% versus the estimated 0.4% decline but the previous month’s reading was revised lower to 1.3%. Mortgage approvals were also lower than expected, according to the BBA. No reports are due from the UK today.

CHF

The franc gave in to dollar strength last Friday as risk aversion took hold of the markets ahead of the weekend. SNB Thomas Jordan also reiterated their pledge to maintain the franc peg in his speech last week, lending more weakness to the currency. There are no reports lined up from Switzerland today.

JPY

The yen got a bit of a boost from the stronger than expected rise in retail sales. The figure showed a 11.0% annualized increase, stronger than the estimated 10.9% growth and the previous 3.6% rise. This eased fears of further easing from the BOJ this week, as many thought that the recently implemented sales tax hike could hurt spending.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were unable to extend their gains in Friday’s trading as traders eased off their riskier holdings. There were no reports released from Australia, New Zealand and Canada then. Only the New Zealand trade balance report is lined up for today and it might print a higher surplus of 919 million NZD versus the previous 818 million NZD.

By Kate Curtis from Trader's Way