Article Highlights

  • New Zealand NZIER business confidence index dipped from 24 to 23
  • Australia’s March NAB business confidence reading improved from 0 to 3
  • U.K. BRC retail sales monitor showed 3.2% gain, previous reading at 0.2%
  • Nikkei up 0.02% for today
  • U.K. inflation reports up for release
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Risk on? Not a chance! Just when it seemed that the higher-yielding currencies were poised to recover against their safe-haven forex counterparts in the early Asian session, risk aversion popped its head back in the financial markets. Economic data wasn’t too bad actually as Australia reported an improvement in its NAB business confidence reading from 0 to 3 for March while New Zealand saw a small dip in its NZIER business confidence index from 24 to 23.

News that several iron ore companies were placed on S&P’s negative credit watch were enough to usher in some risk-off vibes later on in the day, pushing AUD/USD back below the .7600 handle (-0.14%) and NZD/USD down to .7450 (-0.02%). Other major currencies also gave in to the lower-yielding Greenback, with EUR/USD lower by 30 pips (-0.28%) and GBP/USD down by 8 pips (-0.05%).

The yen took advantage of this, allowing USD/JPY to fall by 30 pips (-0.25%) and EUR/JPY to edge down by 66 pips (-0.53%). It looks like Greek debt woes are still weighing heavily on the euro these days and any updates on this situation could spark volatile moves for the shared currency.

As for the British pound, the upcoming inflation releases could serve as a catalyst for big moves in today’s London trading session. The headline CPI is slated to stay flat while the core reading could be unchanged at 1.2%, although weaker than expected data could spur more pound weakness. Watch out for the PPI input report as well since producer prices are slated to show a 0.5% decline and hint at further downside for consumer inflation later on.

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

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