Euro recovered mildly overnight as markets digested recent decline in thin holiday trading. Nonetheless, the common currency stays generally soft against other major currencies. ECB president Draghi affirmed the expectation of policy actions in June in a speech in an ECB conference in Portugal yesterday. He noted that "more pre-emptive action may be warranted." He warned that the central bank needed to be "particularly watchful" for "the potential for a negative spiral to take hold between low inflation, falling inflation expectations and credit, in particular in stressed countries." The conference was the first in an annual ECB event which is modeled on the Fed's Jackson Hole conference. ECB executive board member Constancio, Praet and Coeure will chair panel discussions again today and Draghi will wrap up with closing remarks.
Elsewhere, the Japanese yen is mildly lower today on mild risk appetite. While US markets were closed overnight, the Nikkei is firm today and is up nearly 100 pts at the time of writing. Nonetheless, other indices are generally flat only. Due to the recovery in EUR/USD, the dollar index retreated mildly but is holding firm above 80 handle so far. Gold continues to struggle in tight range slightly below the 1300 handle. Crude oil is holding in tight range too, below 104.50 but the firmness is providing some support to the Canadian dollar.
On the data front, the Japan corporate service price index rose 3.4% year-over-year (yoy) in April versus expectation of 3.3% yoy. The European calendar is rather light with the Swiss trade balance and UK BBA mortgage approvals featured. The main focus in the key economic data release in the US session. Durable goods orders are expected to drop -0.5% in April while ex-transport orders are expected to rise 0.2%. The house price index is expected to rise 0.5% month-over-month (mom) in March while the S&P Case-Shiller 20 cities house price is expected to rise 11.9% yoy in March. Conference board consumer confidence is expected to improve to 83.2 in May.