NEWS / Foreign Exchange

Positive revision to US GDP, but will housing and construction bring it down in Q1?

We saw very limited price actions after the release of the final Q4 GDP figures, but the downtrend in housing related figures (and construction) poses a danger for GDP growth going forward...

Overnight News Bullets

• Japanese Small Business Confidence (Mar) out at 50.4 vs. 48.8 previously.

• Swedish Consumer Confidence (Mar) out at 15.4 vs. 18.0 expected.

• Swedish Manufacturing Confidence (Mar) out at 8 vs. 4 expected.

• German Unemployment Change (Mar) out at -65K vs. -46K expected.

• German Unemployment Rate (Mar) out at 9.2% as expected.

• Norwegian Unemployment Rate (Mar) out at 2.1% as expected.

• Norwegian Retail Sales MoM (Feb) out at 0.2% vs. 0.0% expected.

• A streak of E-Z Retail PMI figures stronger than expected.

• US GDP Annualized (4Q F) out at 2.5% vs. 2.2% expected. Personal Consumption (4Q F) out at 4.2% as expected. GDP Price Index out at 1.7% as expected. Core PCE QoQ (4Q F) out at 1.8% vs. 1.9% expected.

• US Initial Jobless Claims out at 308K vs. 320K expected.

• US Help Wanted Index (Feb) out at 31 as expected.

• NZ GDP (4Q) out at 0.8% vs. 0.9% expected.

• Japanese Jobless Rate (Feb) out at 4.0% as expected. Job-To-Applicant Ratio out at 1.05 vs. 1.06 exp.

• Japanese Overall Household Spending YoY (Feb) out at 1.3% vs. 0.6% expected.

• Japanese CPI data generally lower than expected.

• Japanese Industrial Production MoM (Feb P) out at -0.2% vs. -0.7% expected.

• NZ NBNZ Business Confidence (Mar) out at -12.5 vs. -5.9 previously.

• Japanese Housing Starts YoY (Feb) out at -9.9% vs. -2.5% expected.

• Japanese Construction Orders YoY (Feb) out at 7.0% vs. 4.8% expected.
   

Markets

• FX: USD edging lower. AUD consolidating higher.

• Fixed Income: Continuing lower across the board.

• Stocks: Strong European session. US only posting modest gains. Nikkei a tad higher.

• Commodities: Precious metals consolidating. Oil is two bucks higher, now around 66.50.

O/N Data Heat map:

Calendar

Today's Highlights:

This and Next Week??™s Highlights:

What's going on?

• The better than expected Q4 revision of US GDP sent Treasuries lower. 
• EURUSD in a very tight range. We favor the upside. AUDUSD to accelerate the upside??¦ 0.8214 still a magnetic level.
• Today??™s PCE figures for Feb is key for the rate outlook and the USD. Potential surprises could be important. Construction Spending also important. Expected to drop 0.4%. That might be optimistic. The trend is lower.
• Oil going significantly higher, reflecting increasing risk aversion. Credit spreads are again widening.

FX

Core PCE YoY in focus