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Economic calendar (GMT0):
01:00 Australia Retail Sales Y/Y April +5.7% +5.7%
01:00 China Non-Manufacturing PMI May 54.8 55.5
01:30 Australia Retail sales (MoM) April +0.1% +0.3% +0.2%
01:30 Australia Current Account, bln Quarter I -10.1 -7.1 -5.7
01:30 Japan Labor Cash Earnings, YoY April +0.7% +0.6% +0.9%
01:45 China HSBC Manufacturing PMI (Finally) May 49.7 49.7 49.4
04:30 Australia Announcement of the RBA decision on the discount rate 2.50% 2.50% 2.50%
04:30 Australia RBA Rate Statement
06:00 United Kingdom Nationwide house price index May +1.2% +0.7% +0.7%
06:00 United Kingdom Nationwide house price index, y/y May +10.9 +10.9% +11.1%
08:30 United Kingdom PMI Construction May 60.8 61.2 60.0
09:00 Eurozone Harmonized CPI, Y/Y (Preliminary) May +0.7% +0.7% +0.5%
09:00 Eurozone Unemployment Rate April 11.8% 11.8% 11.7%
The U.S. dollar traded lower against the most major currencies due to the disappointing ISM manufacturing purchase managers’ index in the U.S. The Institute of Supply Management released its manufacturing purchasing managers' index for the U.S. The index dropped to 53.2 in May, from 54.9 in April. Analysts had expected a gain to 55.5.
The New Zealand dollar traded higher against the U.S dollar due to speculation New Zealand’s currency will benefit along with the Australian dollar. Market participants are awaiting the release of the Australian economic growth tomorrow. Australia’s economy should expand 1.1% in the first quarter.
In the absence of any major economic reports in New Zealand, investors also remain concerned about the impact of lower dairy prices on the economy and the interest rate.
The Australian dollar climbed against the U.S. dollar after the Reserve Bank of Australia’s interest rate decision. The Reserve Bank of Australia (RBA) kept interest rate unchanged at a record low 2.5% as expected. The RBA decided to continue accommodative monetary policy. Accommodative monetary policy should provide support to demand and to economic growth.
Earlier in the trading session, Australian retail sales were released. Retail sales in Australia increased 0.2% in April, missing expectations of a 0.3% gain in March, after a 0.1% rise in March.
Australia’s current account deficit declined to AUD5.67 billion in the first quarter from AUD11.7 billion the previous quarter. The deficit of the previous quarter was revised down to AUD11.7 billion from a deficit of AUD10.1 billion. Analysts had expected a reduction of the deficit to AUD7.0 billion.
The Japanese yen traded little changed against the U.S. dollar. Labor cash earning in Japan rose 0.9% in April, exceeding expectations for a 0.6% gain, after a 0.7% increase in March.
EUR/USD: the currency pair increased to $1.3605
GBP/USD: the currency pair traded mixed
USD/JPY: the currency pair traded mixed
AUD/USD: the currency pair increased to $0.9268
The most important news that are expected (GMT0):
14:00 U.S. Factory Orders April +1.1% +0.6%
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