Daily Market Report 14/06/2013 The US dollar was once again in focus yesterday following encouraging data about the US economy. Data from the labour department showed that the number of people filing for jobless claims fell more than expected to 334,000 from 346,000. On top of this, in May, retail sales increased more than expected to 0.6% from 0.1%. However in a surprising move, GBPUSD and EURUSD briefly traded above key resistance levels before settling below them by the close of play. The US dollar was once again in focus yesterday following encouraging data about the US economy. Data from the labour department showed that the number of people filing for jobless claims fell more than expected to 334,000 from 346,000. On top of this, in May, retail sales increased more than expected to 0.6% from 0.1%. However in a surprising move, GBPUSD and EURUSD briefly traded above key resistance levels before settling below them by the close of play. The yen seems to be the key driver of markets at the moment, with strength in the yen causing the US dollar to be sold against most of its counterparts given that it is relatively cheap compared to the US dollar as a safe haven. Elsewhere in the markets we saw sterling rise against the euro by 0.20%, but relatively speaking GBPEUR remains in a sideways trading pattern as it has done for the last three months. GBPINR still remains near all time highs as does GBPZAR. Both the Australian and New Zealand dollar recovered some of the recent losses to each finish around 1.3% stronger on the day coming out of oversold levels. Overnight the Bank of Japan came into focus with their monthly minutes meeting. The yen strengthened as the BoJ disappointed markets by refraining from adding to its stimulus program or adding to its arsenal to tackle the volatility in Japanese government bonds. 10 year Japanese governments bonds have swung from an all time low of 0.315% to 1% ever since the BoJ announced plans on April 4th to double its monetary stimulus program. Looking ahead to today we have inflation and employment figures coming out of the euro zone in the morning with the rate of inflation set to rise to 1.4%. However, it will be once again the US dollar that comes into focus with producer price inflation set to rise to 1.4%, industrial production set to rise to 0.2%. The Reuters/Michigan consumer sentiment index is expected to come in line with forecasts at 84.5. Key Announcements: 10.00am – EUR – Consumer Price Index (YoY) (May): Expected to improve to 1.4%. 10.00am – EUR – Employment Change (QoQ) (Q1): Expected to improve to -0.2%. 13.30pm – CAD – Manufacturing Sales (MoM): Expected to improve to 0.3%. 13.30pm – USD – Producer Price Index (YoY) (May): Expected to improve to 1.4%. 13.30pm – USD – Current Account (Q1): Expected to improve to -US$109.7bn. 14.15pm – USD – Industrial Production (MoM) (May): Expected to improve to 0.2%. 14.55pm – USD – Reuters/Michigan Consumer Sentiment Index (Jun): Expected to come in at 84.5.