US industrial production declined more than expected in March as output dropped broadly, the latest sign that economic growth faltered in the first quarter. Industrial output fell 0.6% last month following a downwardly revised 0.6% decrease in February, according to the Federal Reserve. Industrial production slipped at an annual rate of 2.2% in the first quarter. The report joined data on retail sales, business spending, trade and wholesale inventories in indicating that economic growth slowed at the turn of the year. Growth estimates for the first quarter are as low as a 0.2% annualized rate. The world's number one economy grew at a 1.4% rate in the fourth quarter. However, given a strong labour market, the slowdown in growth is likely to be temporary. A separate report showed US consumer confidence unexpectedly declined in early April for the fourth straight month, as concerns about surging gasoline prices and the broader economy weighed on sentiment. The Thomson Reuters/University of Michigan preliminary Consumer Confidence Index slid to 89.7 points in April, compared with the final 91.0 reported in March, when it had dipped to a fresh five-month low. The Current Economic Conditions sub-index ticked down to 105.4, down from 105.6 in March, while the Index of Consumer Expectations plunged to 79.6 in April, sharply lower than 81.5 reported previously.
New Zealand inflation rose in the first quarter, recovering from the lowest level in 15 years, but remained below the range the Reserve Bank of New Zealand targets, providing the central bank with room for further interest rate cuts. New Zealand's CPI climbed 0.2% in the January-March period, Statistics New Zealand reported, coming in stronger than the median forecast of zero change and much higher than the 0.5% decrease seen in the previous quarter. The main contributor to the surge came from an increase in an excise duty, with cigarette and tobacco prices advancing 9.4% over the reported period, making a 0.25 percentage point contribution change to the headline measure. In addition to that, price increases for strawberries, kiwifruit, and oranges helped lift fruit prices 8.2%. Tepid inflation means there is little hurdle to Governor Graeme Wheeler lowering the official cash rate if needed after cutting it to a record-low 2.25% in March. Market participants are betting on lower borrowing costs as falling oil prices and the New Zealand Dollar's 6.5% gain in the past three months threaten to delay the return of the nation's inflation to the middle of the RBNZ's 1-3% target range. The central bank will review the official cash rate on 28 April.
Upcoming fundamentals: No Euro zone data awaited on Monday
EUR/USD consolidates before ECB this week
On Friday the volume of trading fell to the lowest level since March 28, while the Euro is getting ready for the ECB meeting later in the new week. Fluctuations of the EUR/USD pair are insignificant, with major caps provided by the 1.13 mark and the weekly pivot point above at 1.1327. From the downside, EUR/USD will see rising demand near 1.12 where the monthly pivot is boosted by the weekly S1 and the 55-day SMA. As for the daily technical indicators, they are also mixed on the matter right now.Market sentiment steady for 4 days
Spreads (avg,pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade near 1.12 by July
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between March 18 and April 18 expect, on average, to see the currency pair around 1.12 by the end of July. Though 56% of participants believe the exchange rate will be generally below this important level in ninety days, with 42% alone seeing it below 1.08. Alongside, only 23% of those surveyed reckon the price will trade in the range between 1.12 and 1.18 on July 31.