ASIA session review (25.06.2013): Dollar rises vs. euro as Treasury yields climb

Data released (actual, consensus, previous):   

06:45 GMT France Business Climate (Jun)  93    93    92        

08:00 GMT Italy Retail Sales s.a. (MoM) (Apr)   -0.1%   _     -0.3%        

08:00 GMT Italy Retail Sales n.s.a (YoY) (Apr)  -2.9%   _     -3.2%       

08:22 GMT Greece Current Account (YoY) (Apr)  €-1.187B   _     €-1.285B        

08:30 GMT UK BBA Mortgage Approvals (May)  36.1K    33.1K    32.2K

The U.S. dollar gained against the euro Tuesday, with a rise on the yield of the benchmark U.S. Treasury note strengthening the greenback’s appeal.

Treasury prices slid last week when Federal Reserve Chairman Ben Bernanke said the central bank may taper its bond-purchase program later this year if economic data continue to show an improvement.

Some Fed officials on Monday sought to soften worries about the end of monetary stimulus from the central bank.

Later Tuesday, the market is due to receive reports on U.S. consumer confidence in June, durable-goods orders in May, and two separate reports on housing prices in April. The housing reports will reflect activity in April, before there was a spike in mortgage rates.

EURO:

Greece PASOK’s Venizelos confirmed as deputy PM. He has the joint role of deputy premier and Foreign Minister in the reshuffle officially announced last night, with New Democracy’s Mitsotakis appointed as the Administrative Reform Minister and Stournaras remaining in his position as Finance Minister.

The new cabinet will be sworn in by President Papoulias at 12:30 Athens time today.

EUR/USD holds above yesterday’s lows on $1.3060 with initial resistance comes at $1.3160 (Jun 20 lows), then - at $1.3255/60 (Friday’s high) and $1.3300 (Jun 6 high). Below $1.3060 support comes at $1.3030 (61.8% Fibo of the $1.2790 - $1.3415 rise) and $1.2960 (Apr 24 and Jun 3 lows).

POUND:

The pound remains bid on the release of a better expected set of Mortgage Approvals that arrived as 36.1k vrs a consensus for 33.1k for May.

GBP/USD retreats from session highs, but in general trades above yesterday’s lows on $1.5340 (support now). Below support comes at $1.5280 (Jun 4 lows), then - near $1.5140 (May 31 lows) and $1.5000 (May 29 lows). Initial resistance comes at $1.5450/60 (Friday’s hourly highs), then - at $1.5530 (Jun 21 high), stronger - near $1.5680 (Jun 19 highs).

YEN:

The yen rose from near a two-week low versus the U.S. dollar as Asian stocks slumped for a second day amid concern a cash crunch in China will curb economic growth, supporting demand for haven assets.

The yen strengthened for a second day with a host of U.S. central bankers scheduled to speak this week after two Federal Reserve presidents yesterday emphasized that policy remains accommodative.

USD/JPY holds near Y97.50, below the  Y98.80 resistance (50% Fibo of the Y103.80- Y93.80 decline). Above resistance comes at Y99.90/00 (61.8%). Initial support comes at Y97.20, with a break under targets Friday’s lows near Y96.90.

DATA AHEAD:

Later, at 10:00 GMT, UK CBI Distributive Trades Survey for June comes.

At 12:30 GMT US Durable Goods Orders for May will be in focus with 1.8% expected versus  3.3% in April.

At 13:00 GMT US Housing Price Index for May comes, followed by Jun Consumer Confidence at 14:00 GMT (median 76.6 after 76.2) and May New Home Sales (median 0.460M versus   0.454M).

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