Archived IMT (2011.04.08)

UK inflation expectations are put to the test today by the release of UK March PPI, while Canada jobless for March is expected to improve. US dollar sinks further on lack of budget deal.

Back to a tamer calendar in the way of economic data releases today with UK PPI for March expected to invite further debate about the Bank of Englands decision to hold rates yesterday. Factory gate prices have CONTINUALLY LED the official inflation numbers which are due out next week, therefore, these are expected to be no different and are expected to remain elevated. Year on Year input prices are expected to come in around 13.2%, down from prior months 14.6% while core output prices are seen around 3%.

GBP regains $1.6350s foundation after bouncing off 1.6260 support, now eyeing the 1.6460s highs from last year as the next key objective. EURGBP has yet to surpass 0.8850. EURUSD looking to regain $1.44 despite Trichets coyness on whether or not there would be plans to raise rates again. Keep an eye on 1.4580, which is the high from last year.

CANADA EMPLOYMENT REPORT for March is due out at around midday UK time and the unemployment rate is expected to slip back to 7.7% from last months 7.8% with a net change of 27.8k, a slight increase of last months 15.1k.

CAD still rides on the back of higher oil despite USDCAD aiming to find support at 0.9570. Yet, we remain well above the all-time lows of 0.9060 from 4 yrs ago. Fresh 30-month highs for both US crude & Brent, while silver hits the $40 mark, and gold holds above $1,460. USDX HITS 16-mnth lows, nearing 75.00 as the US budget saga & looming gvt shutdown weighs on the currency.

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By KM - AshrafLaidi.com Staff.