Forex markets took something of a three-day weekend with few movements seen across the space, but today's US CPI release may provide some directional force for the greenback pairs, says Saxo head of FX strategy John Hardy.

"The focus is on the CPI release as well as the Federal Reserve's 'terminal rate' of 3€ [which is drawing into view]," says Hardy. The inflation release is forecasted at 2% month-on-month and occurs in the wake of Monday's US T-bill auctions, which Hardy reports saw reasonable but not superlative demand for the issues.

In single currencies, Hardy points to the rouble as a potential candidate for a move in light of the UK's forceful accusations that Moscow orchestrated the poisoning of an ex-spy and his daughter on British soil. Hardy notes, however, that the "special relationship" with the US is not leading to much diplomatic support from Washington while the UK's erstwhile allies across the pond may be more concerned with Brexit.

In stocks, Saxo head of equity strategy Peter Garnry reports that the recovery from early February's 'vol shock' continues to be narrow in the US and altogether lacking in Europe and Japan, where indexes have not yet recovered 50% of those losses.

"We remain neutral to defensive on equities," says Garnry, with Saxo Bank technical analyst Kim Cramer Larsson chiming in that he sees very strong resistance at 2,800 on the S&P 500, a level he calls critical for bulls.

Finally, Saxo Bank head of commodity strategy Ole Hansen tells us that oil prices are broadly caught in range ($61-64/barrel for WTI), supported on the one hand by robust global demand even as US shale production continues to rise. 

According to the US Energy Information Administration, US shale output is expected to expand by 161,000 barrels/day in April.

For more on agricultural commodities, metals, EM and frontier market stocks and more, watch today's Morning Call in full.


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