It was a relatively quiet week on the economic calendar, in the week ending 10th April.
A total of 41 stats were monitored, following the 78 stats in the week prior.
Of the 41 stats, 16 came in ahead forecasts, with 23 economic indicators coming up short of forecast. 2 stats were in line with forecasts in the week.
Looking at the numbers, just 11 of the stats reflected an upward trend from previous figures. Of the remaining 30, 29 stats reflected a deterioration from previous.
For the Greenback, it was a relatively bearish week, with the dollar giving up some of last week’s 2.25% gain. The U.S Dollar Spot Index fell by 1.09% to end the week at 99.482.
Economic data continued to take a back seat in the week. Once more, the markets were focused on the coronavirus numbers. This time around, however, the FED also contributed to the Dollar’s pullback,
As at the time of writing, the total number of coronavirus cases stood at 1,604,090. In the U.S, the total rose to 502,049, with France, Germany, Italy, and Spain reporting a combined total of 552.890.
Key takeaways included a downward trend in the number of new cases across the 4 most-affected EU member states.
Out of the U.S
It was a quieter week on the economic calendar. The weekly jobless claims and April consumer sentiment figures were the key drivers in the week.
Initial jobless claims jumped by 6.606m in the week ending, 3rd April, following a 6,867m rise the week prior.
Consumer sentiment took a hit in April as the U.S entered lockdown in key states and unemployment surged.
The Michigan Consumer Sentiment Index slid from 89.1 to 71.0, which was the largest decline on record.
The Expectations Index fared somewhat better, falling from 79.7 to 70.0. Hopes of the impact of the virus being temporary limited the downside.
At the start of the week, February’s JOLTs job openings had a muted impact, with March inflation figures also brushed aside.
While the stats provided some influence, it ultimately came down to risk appetite and FED action for the Greenback.
A downward trend in the number of new coronavirus cases supported risk appetite that weighed on the Dollar. Another FED move on Thursday added further pressure on the Greenback on Thursday.
The latest FED move was of great significance for small and medium-sized companies and U.S states and counties. The FED delivered a $2.3tn program to support local governments and small to medium-sized businesses.
The program would offer 4-year loans to companies of up to 10,000 employees and also buy municipal bonds
In the equity markets, the Dow and S&P500 rallied by 12.67% and 12.10% respectively, with the NASDAQ gaining 10.59%. For the S&P500, it was the best weekly gain since 1974.
Out of the UK
It was a busy week on the economic calendar.
A slide in the construction PMI in March tested the Pound on Monday ahead of a particularly busy Thursday.
February GDP, manufacturing and industrial production figures provided direction on Thursday.
The stats were February numbers, however, limiting any impact on the Pound despite the stats being skewed to the negative.
A weaker Dollar and improving coronavirus numbers provided support as did news of Boris Johnson coming out of ICU. The Pound had come under pressure on news of the British PM being admitted into ICU. Concerns over Foreign Secretary Raab’s stance on Brexit and fiscal policy had tested the Pound.
In the week, the Pound rose by 1.52% to $1.2455, reversing the previous week’s 1.53% decline. The FTSE100 ended the week up by 7.89%.
Out of the Eurozone
It was a quieter week economic data front.
Germany was back in the spotlight, with February factory orders, industrial production and trade data in focus.
While the stats were mixed, the February numbers were yet to reflect the impact of COVID-19 thus allowing the markets to brush aside the numbers.
Factory orders fell by 1.4%, following a 4.8% increase in January, while industrial production increased by 0.3%. In February, production had risen by 3.2%.
Trade figures were EUR positive, however, with the German trade surplus widening from 18.7bn to €21.6bn.
Away from the economic calendar, the ECB monetary policy meeting minutes revealed differing views amongst members. One common theme, however, was the need to deliver monetary policy support.
A negative mid-week, however, was a failing by EU Finance Ministers to agree on issuing corona bonds to counter the effects of the Coronavirus on the Eurozone economy.
Late in the week, a €500bn stimulus package was approved, though this fell well short of the numbers that the ECB was looking for…
For the week, the EUR rose by 1.26% to $1.0937, partially reversing a 3.05% slide from the previous week.
For the European major indexes, it was a bullish week. The DAX30 rallied by 10.91%, with the CAC40 and EuroStoxx600 rising by 8.48% and 7.36% respectively.
Elsewhere
It was a particularly bullish week for the Aussie Dollar and the Kiwi Dollar.
In the week ending 10th April, the Aussie Dollar rallied by 5.87% to $0.6349, with the Kiwi Dollar rising by 3.39% to $0.6077.
For the Aussie Dollar
It was a quiet week for the Aussie Dollar on the economic data front once more. Economic data was limited to February trade figures that had a muted impact on the Aussie.
The trade deficit narrowed moderately in the month, leaving the focus on the RBA in the week.
On Tuesday, the RBA left rates unchanged, with the RBA Rate Statement suggesting a near-term hold on monetary policy.
While the RBA stance provided early support for the Aussie, the RBA’s Financial Stability Review, on Thursday, was Aussie Dollar negative.
The Review had few, if any, positives for the markets to hold onto amidst the doom and gloom.
Ultimately, however, a pickup in market risk appetite and a sliding Greenback delivered the upside.
For the Kiwi Dollar
It was a relatively quiet week on the economic calendar, with key stats limited to 1st quarter business confidence figures and March retail sales figures.
The NIEZR Business Confidence Index took a hit, with 67% of businesses expecting a deterioration in economic conditions.
On Thursday, retail sales figures were no better, with electronic card retail sales sliding by 3.9% in March. Things could have been a lot worse had there not been a record rise in grocery sales.
On the monetary policy front, talk from the RBNZ of more support and possible negative rates down the road also pinned back the Kiwi Dollar in the week.
A pickup in risk appetite and the slide in the Greenback, however, delivered the upside in the week.
For the Loonie
It was a relatively busy week on the economic calendar.
Key stats included Ivey PMI and employment figures for March.
The stats were skewed to the negative, with the Ivey PMI sliding from 54.1 to 26.0. Following the dire unemployment numbers from the U.S, the markets were somewhat desensitized to the employment figures.
In March, employment tumbled by 1m, leading to a jump in the unemployment rate from 5.6% to 7.8%.
On the monetary policy front, the BoC Business Outlook Survey did little to support the Loonie at the start of the week.
A U.S Dollar on the slide returned the Loonie to sub-C$1.40 levels in spite of the OPEC – Plus meeting coming to an abrupt end on Thursday… Expectations are that an agreement will be made, which prevented a sell-off.
The Loonie rose by 1.75% to end the week at C$1.3956.
For the Japanese Yen
It was a quiet week on the data front.
February household spending figures were in focus early in the week. While down 0.3%, year-on-year, there was a monthly 0.80% increase in spending.
There was little influence on the Yen, however, which ended the week flat relative to its peers.
While stats were on the lighter side, the Japanese government made its move in the week.
The choppers are out once more, with helicopter money promised through a $1tn stimulus package to combat the impact of COVID-19.
The Japanese Yen rose by 0.07% to end the week at ¥108.47. In the week prior, the Yen had fallen by 0.57% against the U.S Dollar.
Out of China
It was a relatively quiet week on the economic data front.
Economic data was limited to March inflation figures that revealed the effects of COVID-19.
The impact on the global financials was muted, however, with most of the major markets closed for Good Friday.
In the week ending 10th April, the Yuan rose by 0.78% to CNY7.0360 against the Greenback.
The CSI300 rose by just 1.51%, with the Hang Seng ending the week up by 4.58%. When considering the easing of containment measures in China, the gains were minor, however…
