FINANCIALS: UniCredit - Appeals golden power conditions
* UniCredit is appealing the legality of Italy's golden power conditions - https://mni.marketnews....
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STIR: Soft Data Key To Near-term ECB Outlook; OIS Fully Price June Cut
Soft data will be key in charting the Eurozone’s economic trajectory in the coming months, with hard data significantly lagging volatile US tariff developments. Yesterday’s flash April consumer confidence was weaker than expected, with focus now on this morning’s flash PMIs (France 0815BST, Germany 0830BST and Eurozone 0900BST).
- Analysts expect the Eurozone-wide composite PMI at 50.2, which would fully unwind March’s 0.7pp bounce to 50.9. Services is seen at 50.5 (vs 51.0 prior) and manufacturing at 47.4 (vs 48.6 prior). Similar dynamics are expected in the French and German readings.
- Last Thursday’s post decision Reuters sources piece noted that “some ECB policymakers see a high chance of a further interest rate cut in June” (in line with current market pricing), while others who are thus far undecided “want to see how soft indicators of economic activity and other variables such as energy prices pan out before making any predictions about their next meeting”.
- ECB-dated OIS price ~65.5bps of easing through year-end, 4.5bps more hawkish than yesterday’s close with risk sentiment supported by more constructive comments around China and Powell from US Tsy Sec Bessent and President Trump.
- Euribor futures are -0.5 to -5.5 ticks through the blues, with the whites/reds leading the selloff.
- The ECB’s forward looking wage tracker is also due this morning (0900BST), alongside February trade data (1000BST). Speakers include Knot, Villeroy, Lane and Cipollone.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Cut-adjusted Effective ESTR Rate (bp) |
| Jun-25 | 1.944 | -22.3 |
| Jul-25 | 1.796 | -37.1 |
| Sep-25 | 1.637 | -53.0 |
| Oct-25 | 1.580 | -58.7 |
| Dec-25 | 1.512 | -65.5 |
| Feb-26 | 1.498 | -66.9 |
| Mar-26 | 1.495 | -67.2 |
| Apr-26 | 1.502 | -66.5 |
| Source: MNI/Bloomberg. | ||
USDCAD TECHS: Southbound
- RES 4: 1.4415 High Apr 1
- RES 3: 1.4296 High Apr 7
- RES 2: 1.4165 50-day EMA
- RES 1: 1.3906/4029 High Apr 17 / 20-day EMA
- PRICE: 1.3814 @ 08:01 BST Apr 23
- SUP 1: 1.3781 Low Apr 21
- 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
A bearish theme in USDCAD remains intact for now and the pair is trading at its recent lows. Fresh cycle lows continue to highlight a resumption of the downtrend and signal scope for a continuation near-term. Potential is seen for a move towards 1.3744, a Fibonacci retracement. Moving average studies are in a bear -mode position, highlighting a dominant downtrend. First resistance to watch is 1.4029, the 20-day EMA.
AUDUSD TECHS: Maintains A Bullish Tone
- RES 4: 0.6550 61.8% retracement of the Sep 30 ‘24 - Apr 9 bear leg
- RES 3: 0.6528 High Nov 29 ‘24
- RES 2: 0.6471 High Dec 9 ‘24
- RES 1: 0.6439 High Apr 22
- PRICE: 0.6418 @ 07:58 BST Apr 23
- SUP 1: 0.6349/6299 Low Apr 21 / 20-day EMA
- SUP 2: 0.6181 Low Apr 11
- SUP 3: 0.6116 Low Apr 10
- SUP 4: 0.5915 Low Apr 9 and key support
AUDUSD is holding on to its recent gains and a bullish theme remains intact. The pair has breached a key resistance at 0.6409, the Dec 9 ‘24 high. This reinforces bullish conditions and signals scope for a continuation higher near-term. Sights are on 0.6471 next, the Dec 9 2024 high. Initial key support to monitor is 0.6299, the 20-day EMA. A clear break of this EMA would be a concern for bulls.
