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The Bank of England delivered the anticipated 25-basis point despite stubborn inflation which remains in double figures ahead of the country’s GDP data due Friday. China posted lower-than-expected inflation data along with producer prices for showing a slower-than-expected recovery.
AUDUSD tanked by -0.60% trading below the 0.6850 following soft data from China. The Consumer Price Index [YoY] from China at 0.1% vs expectations of 0.4% suggested a deflationary environment and showed that the economy is putting up a patchy recovery post-covid-19.
Producer prices in China also missed targets at -3.6% vs -3.5% expected, weighing on the AUD. This along with the US dollar’s rebound acted as a headwind for the Aussie ahead of the US initial Jobless Claims data. Sellers may slide to 0.6700 and 0.6650 in the near term.
EURGBP lost -0.38% after the release of the BoE May rate decision. The UK central bank hiked by the expected 25bps taking the interest rate to 4.50%. Data showed that seven people voted for a hike while two voted for unchanged rates. Prior to the rate decision data from the Royal Institution of Chartered Surveyors indicated a change to the upside in house price increase at -39% vs -40%.
Meanwhile, in the Eurozone, consumer confidence from Spain will be due today along with a speech from ECB’s Luis De Guindos. The pair fell from 0.8700 with targets seen at 0.8650 and 0.8600 on the downside.
NZDJPY traded -0.38% lower despite downbeat data from Japan. The Ministry of Finance from Japan reported a less-than-expected current account at 2.278 trillion vs 2.947 trillion for March.
Early Thursday the Food Price Index in New Zealand rose to 0.5% beating estimates of 0.4% although the data was without much help to the local currency. The pair was hanging on to 85.50 high as bears slid towards 85.00 and 84.80.
European stocks traded in a mixed manner following the release of the UK central bank rate decision. The UK100 was down -0.34% trading at the 7700 area. Further down sellers may reclaim 7600. CAC40 was up +0.25% although bears trimmed off gains down below 7400. DAX lost -0.20% as bears extended the 4-day losing streak.
US stock futures were quite mixed as investors digest inflation data from the US. Futures were subdued on Thursday after a missed earnings report by Walt Disney on Wednesday. The Nasdaq 100 futures rose +0.08% as bulls face a cap at 13400 support-turned-resistance as they aim for 13500 and 13600. S&P 500 futures were down -0.08% after buyers got rejected at the 4160 mark yesterday heading to 4200. DJIA futures lost -0.20% extending Wednesday’s losses with an intraday high at 33 600.
In commodities, gold traded lower on Thursday after a lower-than-expected inflation print in the US. The precious metal lost -0.13% against the greenback as $2050 remains a hurdle to the upside. A move below the current $2020 low may give up $2000.
