Yen to Extend Gains as Risk Aversion Spills into European Trade

    * Japanese Yen Soars, US Dollar and Swiss Franc Follow on Broad-Based Risk Aversion
    * Asian Stocks Fall as IMF Cuts US Growth Outlook, Japan Upgrades Nuclear Threat
    * UK Retail Sales Drop Most Since 1995, Arguing Against Rate Hikes According to BRC

Critical Levels

CCY	SUPPORT	RESISTANCE
EURUSD	1.4355	1.4448
GBPUSD	1.6235	1.6383

The Euro and the British Pound declined, down as much as 0.4 percent apiece hostile to the US Dollar as the greenback capitalized on a broad-based move headed for expose aversion across fiscal markets (see below). We be inflicted with identified the outlines of fleeting access setups pro EURUSD and GBPUSD.

Asia Session: What Happened

GMT	CCY	EVENT	ACT	EXP	PREV
23:01	GBP	BRC Sales Like-For-Like (YoY) (MAR)	-3.5%	-	-0.4%
23:01	GBP	RICS House Price Balance (MAR)	-23%	-24%	-26%
23:50	JPY	Japan Money Stock M2 + CD (YoY) (MAR)	2.7%	2.5%	2.4%
23:50	JPY	Japan Money Stock M3 (YoY) (MAR)	2.0%	1.9%	1.8%
23:50	JPY	Bank Lending Banks ex-Trust (MAR)	-1.8%	-	-2.0%
23:50	JPY	Bank Lending incl Trusts (YoY) (MAR)	-1.7%	-	-1.9% (R-)
23:50	JPY	Bank Lending Banks Adjustments (YoY) (MAR)	-1.7%	-	-1.7%
0:00	NZD	QV House Prices (YoY) (MAR)	-2.0%	-	-1.7%
1:30	AUD	NAB Business Conditions (MAR)	9	-	-2
1:30	AUD	NAB Business Confidence (MAR)	9	-	14

The Japanese Yen outperformed in overnight trade, rising as much as 1.6 percent hostile to its major counterparts, as stocks dropped across Asian bourses and spurred broad-based promotion of risky assets counting involve trades funded cheaply in the perennially low-yielding currency. The safety-linked US Dollar and Swiss Franc followed the Japanese element privileged, count as much as 0.2 and 0.7 percent correspondingly hostile to the majors. The Australian Dollar proverb outsized losses, down as much as 1.3 percent on mean.

The MSCI Asia comforting regional target justice pointer fell 1.1 percent – the generally in near a month – with the International Monetary Fund (IMF) graze its fiscal growth outlook pro the US and Japan. The IMF understood US output would add 2.8 percent this time, down from a 2.9 percent boost in 2010. It had previously probable the world’s top consumer promote (and bellwether pro comprehensive recovery) to grow 3 percent in 2011. Sellerswere additional encouraged by news with the intention of Japan's Nuclear and Industrial Safety Agency raised the severity rating of its nuclear predicament to the highest, matching the catastrophe by Chernobyl, as rising radiation levels timely wider evacuations.

On the data front, UK Retail Sales fell 3.5 percent in the time through progression according to the British Retail Consortium, marking the most terrible decline on confirmation since 1995. BRC Director General Stephen Robertson chalked up the upshot to “mounting fuel and helpfulness expenditure, falling household prices, privileged storage bin (a consumption tax) and the possibility of additional [fiscal retrenchment]” as the government facility to reduce the financial statement shortage. Robertson called on the Bank of England to get on to “supporting our weak nation [a priority,]” in conflict hostile to raising appeal tariff.

Euro Session: What to Expect

GMT	CCY	EVENT	EXP	PREV	IMPACT
6:00	EUR	German Consumer Price Index (MoM) (MAR F)	0.5%	0.5%	Low
6:00	EUR	German Consumer Price Index (YoY) (MAR F)	2.1%	2.1%	Low
6:00	EUR	German CPI - EU Harmonised (MoM) (MAR F)	0.5%	0.5%	Low
6:00	EUR	German CPI - EU Harmonised (YoY) (MAR F)	2.2%	2.2%	Low
6:45	EUR	French Current Account (euros) (FEB)	-	-5.1B	Low
8:30	GBP	Visible Trade Balance (Pounds) (FEB)	-£8000	-£7057	Medium
8:30	GBP	Total Trade Balance (Pounds) (FEB)	-£3950	-£2950	Low
8:30	GBP	Trade Balance Non EU (Pounds) (FEB)	-£4900	-£4173	Low
8:30	GBP	DCLG UK House Prices (YoY) (FEB)	0.1%	0.5%	Low
8:30	GBP	Consumer Price Index (MoM) (MAR)	0.6%	0.7%	Medium
8:30	GBP	Consumer Price Index (YoY) (MAR)	4.4%	4.4%	High
8:30	GBP	Core Consumer Price Index (YoY) (MAR)	3.3%	3.4%	Medium
8:30	GBP	Retail Price Index (MAR)	232.8	231.3	Medium
8:30	GBP	Retail Price Index (MoM) (MAR)	0.6%	1.0%	Medium
8:30	GBP	Retail Price Index (YoY) (MAR)	5.5%	5.5%	Medium
8:30	GBP	RPI Ex Mort Int Payments (YoY) (MAR)	5.5%	5.5%	Low
9:00	EUR	German ZEW Survey (Current Situation) (APR)	85.2	85.4	Medium
9:00	EUR	German ZEW Survey (Econ Sentiment) (APR)	11.3	14.1	High
9:00	EUR	Euro-Zone ZEW Survey (Econ Sentiment) (APR)	-	31	Medium

Stock pointer futures tracking answer European and US exchanges are securely in the red yet to be of the opening bell, hinting the aggressive move headed for expose aversion prominent in overnight trade is fit to involve ended into the following session. On balance, this promises continued gains pro the Japanese Yen, Swiss Franc and US Dollar hostile to their major counterparts, with the particularly risk-sensitive commodity dough bloc facing the generally aggressive promotion pressure.

UK Consumer Price Index facts are fit to trade show the annualized inflation rate held by 4.4 percent in progression, matching a 29-month distinguished recorded in the before month. The conception seems dodgy to yield a strong result from the markets with continue week’s non-event appeal rate decision from the Bank of England. The then answer event pro shaping monetary plan expectations is on tap then week as the central layer releases minutes from its April sit-down, offering insight on the evolution of the hawk/dove balance on the rate-setting MPC.

Germany’s ZEW Survey of investor confidence is probable to trade show sentiment soured in April, marking the following consecutive decline and docile the lowest conception in four months. The gauge unexpectedly declined continue month yet to be of a widely probable appeal rate hike from the European Central Bank amid fears the move was premature as independent expose fears continued to linger. With with the intention of rate boost currently in place, today’s relief will supply as a referendum on the wisdom of the ECB’s events.