RUSSIA: Stronger Ruble, Lower Oil Prices Weigh on Federal Budget Revenue
* The federal budget's oil and gas revenues fell almost 50% month-on-month and 35% year-on-year to...
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STIR: Final April Services PMIs Early Focus, June Cut Still Fully Priced
Following the upward revision to the Eurozone April final manufacturing PMI, early Eurozone focus will be on whether the services PMI fares similarly. The April flash read of 49.7 (vs 50.5 cons, 51.0 prior) was the lowest (and first contractionary) print since November. The data is unlikely to meaningfully shift the outlook for near-term ECB policy though, with ECB-dated OIS still essentially fully pricing a 25bp cut through June, with a 50% implied probability of a follow-up cut in July.
- 60bps of easing are priced through year-end, down from 66bps at last Thursday’s close, with hawkish adjustments driven by movements in Fed pricing.
- Yesterday afternoon, the dovish Stournaras suggested further rate cuts are likely, but avoided any “big promises”.
- Euribor futures are little changed through the blues, with ERZ5 hovering just above 98.000.
- Eurozone March PPI is due at 1000BST.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Jun-25 | 1.930 | -23.8 |
| Jul-25 | 1.806 | -36.1 |
| Sep-25 | 1.660 | -50.7 |
| Oct-25 | 1.619 | -54.8 |
| Dec-25 | 1.565 | -60.2 |
| Feb-26 | 1.557 | -61.1 |
| Mar-26 | 1.550 | -61.8 |
| Apr-26 | 1.561 | -60.6 |
| Source: MNI/Bloomberg. | ||
SILVER TECHS: Support Remains Intact
- RES 4: $36.000 - Round number resistance
- RES 3: $34.903 - High Oct 23 ‘24 and the bull trigger
- RES 2: $34.590 - High Mar 28
- RES 1: $33.686 - High Apr 25
- PRICE: $33.050 @ 08:10 BST May 6
- SUP 1: $31.668 - Low May 1
- SUP 2: $30.915/28.351 - Low Apr 11 / 7 and the bear trigger
- SUP 3: $27.686 - Low Sep 6 ‘24
- SUP 4: $27.180 - Low Aug 14 ‘24
A strong rally in Silver on Apr 23 reinforced the current bullish theme. This suggests the latest pullback that started Apr 25, is a correction. Key short-term support has been defined at $31.668, the May 1 low. A break of this level would signal scope for a deeper retracement and open $30.915, the Apr 11 low. For bulls, resistance to watch is $33.686, the Apr 24 high. Clearance of this level would confirm a resumption of the uptrend.
USDCAD TECHS: Southbound
- RES 4: 1.4415 High Apr 1
- RES 3: 1.4296 High Apr 7
- RES 2: 1.4066 50-day EMA
- RES 1: 1.3914 20-day EMA
- PRICE: 1.3821 @ 08:04 BST May 6
- SUP 1: 1.3760 Low May 2 and the bear trigger
- SUP 2: 1.3744 76.4% retracement of Sep 25 ‘24 - Feb 3 bull run
- SUP 3: 1.3696 Low Oct 10 2024
- SUP 4: 1.3643 Low Oct 9 ‘24
Bearish conditions in USDCAD remain intact. A fresh cycle low last Friday reinforces the bearish theme signalling scope for a continuation, near-term. Potential is seen for a move towards 1.3744, a Fibonacci retracement. Note that Moving average studies are in a bear mode position, highlighting a dominant downtrend. On the upside, first resistance to watch is 1.3914, the 20-day EMA.
