Daily Market Outlook by Kate Curtis from Trader's Way

Commercial Content Analysts
540

USD

The US dollar had a mixed performance in recent trading sessions, as traders are probably squaring off their positions ahead of the US NFP release today. Data from the US came in mostly weaker than expected, with the initial jobless claims report showing a 277K figure and the ISM manufacturing PMI falling from 51.1 to 50.2. The jobs report is expected to show a 201K increase in hiring for September, up from the previous 173K gain. Stronger than expected figures could fuel rate hike expectations for the Fed, possibly resulting to a dollar rally.

EUR

The euro regained a bit of ground in recent trading when data from the euro zone came in mostly in line with expectations. Only the Italian manufacturing PMI missed the mark while the German and French final PMI readings were unchanged. The Spanish unemployment change report is up for release today and a 17.9K increase in joblessness is eyed.

GBP

The pound staged a small rebound yesterday when the UK manufacturing PMI came in line with expectations. The figure fell from 51.6 to 51.5 in September, slightly higher than the projected 51.3 figure. For today, the construction PMI is due and a climb from 57.3 to 57.5 is expected, although traders might want to wait until the release of the services PMI next week.

CHF

The franc was still in a weak spot after Switzerland reported a weaker than expected retail sales figure. Consumer spending fell by 0.3% year-over-year in August instead of showing the projected 0.3% increase. There are no reports due from the Swiss economy today.

JPY

The yen gave up ground to its forex rivals, as data from Japan has been coming in weaker than expected. Earlier today, the country reported an increase in joblessness, as the unemployment rate ticked up from 3.3% to 3.4%. Household spending, on the other hand, came in strong with a 2.9% gain versus the projected 0.4% uptick. There are no other reports lined up from Japan, leaving market sentiment in control of yen price action.

Commodity Currencies (AUD, NZD, CAD)

The comdolls strengthened in recent trading sessions, after Chinese PMI readings came in mostly in line with expectations. Australia reported a 0.4% increase in retail sales as expected, enough to bounce back from the previous 0.1% decline. No other reports are lined up from the comdoll economies today, which suggests that they might take their cues from commodity movements.

By Kate Curtis from Trader’s Way

541

USD

The US dollar sold off sharply against its forex rivals when the NFP report came in way below expectations. The report indicated a mere 142K increase in hiring instead of the projected 201K gain while the previous reports were downgraded to a total of 59K in negative revisions. The jobless rate still held steady at 5.1% as expected but wage growth was absent. The US ISM non-manufacturing PMI is due today and a fall from 59 to 58 is eyed.

EUR

The euro took advantage of dollar weakness and the pickup in risk appetite at the end of the week, even though data from the region came in below consensus. The Spanish unemployment change report showed a 26.1K increase in joblessness versus the projected 17.9K rise and the previous 21.7K increase. Final services PMI readings from the euro zone’s largest economies are due today, along with the Sentix investor confidence index.

GBP

The pound managed to take a break from its recent slide against the dollar on Friday, as the UK construction PMI came in better than expected. The figure climbed from 57.3 to 59.9, reflecting a faster pace of industry expansion in September. For today, the services PMI is due and a rise from 55.6 to 56.4 is expected. This might have a larger impact on pound price action since the services sector contributes more to overall economic growth.

CHF

The franc was able to advance against its forex peers in recent trading, as market participants sought another safe-haven alternative after seeing the dismal US NFP. There were no reports released from Switzerland then and none are due today, keeping the franc sensitive to risk flows.

JPY

The yen gained ground to the dollar on Friday, even though the reports from Japan came in mixed. Household spending picked up by 2.9% year-over-year while the jobless rate increased from 3.3% to 3.4% in the same month. Earlier today, the average cash earnings report showed a weaker than expected rise in wages of 0.5% versus the projected 0.7% figure.

Commodity Currencies (AUD, NZD, CAD)

The comdolls took advantage of dollar and yen weakness on Friday, as commodities also drew a bit of support as well. Australian retail sales came in line with expectations of 0.4% growth while today’s ANZ job advertisements release showed a 3.9% jump in listings. No other reports are due from the comdolls today, keeping risk sentiment in play.

By Kate Curtis from Trader’s Way

542

USD

The dollar had a mixed performance against its peers, although it was generally weaker due to the downbeat NFP release last week.

Data from the US came in weaker than expected, as the ISM non-manufacturing PMI fell from 59.0 to 56.9, worse than the projected fall to 58.0. The US trade balance is up for release today and a wider deficit is eyed, possibly indicating a fall in export activity.

EUR

The euro continued to chalk up losses against its higher-yielding forex counterparts, as the euro zone final services PMI readings came in mixed. Spain and Italy posted weaker than expected results while France printed an upward revision and Germany’s reading was downgraded slightly. Euro zone retail sales came in flat instead of showing the projected 0.1% dip. German factory orders data is due today and a 0.5% rebound is eyed.

GBP

The pound struggled to end its decline in recent trading sessions, but was pushed lower by a bleak services PMI figure. The report showed a drop from 55.6 to 53.3 instead of the projected rise to 56.4, indicating that industry growth slowed down in September. There are no major reports lined up from the UK today.

CHF

The franc could be in for a bit more volatility today since Switzerland is set to print its latest CPI reading. The report could show a 0.1% uptick in price levels after falling by 0.2% in the previous month, but weaker than expected data could mean more losses for the franc.

JPY

The yen sold off heavily against its forex rivals, as risk appetite appeared to improve yesterday and traders priced in downbeat remarks from the BOJ in this week’s rate statement. Japanese average cash earnings data was weaker than expected with a 0.5% uptick instead of the estimated 0.7% increase. There are no reports due from Japan today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to advance against their counterparts in recent trading sessions, thanks to the pick up in commodity prices and the return in risk appetite due to forecasts of a delayed Fed rate hike. Australia’s ANZ job advertisements picked up by 3.9% indicating better hiring prospects while the RBA kept rates on hold at 2.00% earlier today. In New Zealand, the NZIER business confidence index slipped from 5 to -14 but traders seem to be awaiting positive results from the upcoming dairy auction. Canada’s trade balance and Ivey PMI are also on today’s docket.

By Kate Curtis from Trader’s Way

543

USD

The US dollar reacted mostly to risk sentiment and continued to weaken against its forex rivals, as data from the economy simply came in line with expectations.

The trade deficit widened from 41.8 billion USD to 48.3 billion USD, indicating a 2% decline in exports and an increase in shipments coming from China. For today, only the crude oil inventories report is due and this might have more of an impact on the Loonie rather than the Greenback.

EUR

The euro resumed its advance to the dollar in recent trading sessions, despite weaker than expected data from Germany. Instead of printing the estimated 0.5% rebound, Germany factory orders slipped by 1.8% and the previous reading was downgraded to show a 2.2% tumble. German industrial production and French trade balance numbers are due today and more weak figures could erase the euro’s recent gains.

GBP

The pound managed to make a bit of recovery in yesterday’s trading sessions, even though the Halifax HPI from the UK came in below expectations. The report showed a 0.9% drop in house prices instead of the projected 0.1% uptick. For today, the UK manufacturing production figure is due and it might show a 0.4% rebound from the previous 0.8% decline.

CHF

The franc advanced against its forex peers when the Swiss CPI came in line with expectations of a 0.1% uptick. For today, data on foreign currency reserves is due and a large increase in holdings could suggest currency intervention by the SNB, which might drive the franc lower again.

JPY

The yen was still in a weak spot leading up to today’s BOJ rate statement, as investors are pricing in dovish remarks from the central bank. Data from Japan has been mostly disappointing recently, which might factor in the central bank’s decision. No actual policy changes are expected for now.

Commodity Currencies (AUD, NZD, CAD)

The comdolls continued to advance against their peers in recent trading sessions, supported by the pickup in dairy prices in New Zealand and the RBA’s decision to stand pat. The latest GDT auction recorded a 9.9% increase in prices, marking its fourth consecutive bi-weekly gain and signaling a bottom in the dairy industry. In Canada, the trade balance and Ivey PMI came in weaker than expected. Canadian building permits data is due today and a 0.5% increase is expected.

By Kate Curtis from Trader’s Way

544

USD

The US dollar had a mixed performance once more, as it gave up ground to most of its forex peers but advanced to the euro and the franc. There have been no major reports out of the US yesterday, leaving the dollar to act mostly as a counter currency. For today, the FOMC minutes are up for release and might contain some upbeat remarks from Fed officials. However, traders are likely to take this in light of the recent NFP disappointment, possibly brushing off strong hints about a liftoff later this year.

EUR

The euro was still in a weak spot yesterday, particularly against commodity currencies. There have been no major reports out of the euro zone, as traders seem to be bracing themselves for more dovishness in the ECB meeting minutes to be released today. Keep in mind that it was during the September meeting when Draghi admitted that they’re open to further easing if inflation falls further, and support from his other policymakers could weigh on the euro.

GBP

The pound was able to stage a decent rebound in yesterday’s trading sessions, thanks to an upbeat UK manufacturing production figure. The report showed a 0.5% increase versus the projected 0.4% rise, following a positive revision in the previous reading. Industrial production was also better than expected with a 1.0% gain versus the projected 0.3% uptick. The BOE rate statement and MPC meeting minutes are due today, with reassuring remarks likely to extend the pound’s rallies.

CHF

The franc gave up ground to the dollar, even though the Swiss foreign currency reserves didn’t confirm any large intervention moves by the SNB. Traders seem to be trading the Swissy carefully ahead of the ECB meeting minutes release, as dovish remarks could lead the Swiss central bank to ease as well. The Swiss jobless rate is also due today and a climb from 3.3% to 3.4% is eyed.

JPY

The yen was off to a weak start as traders anticipated dovish remarks from the BOJ, but the safe-haven currency was able to regain ground during the latter sessions. The central bank kept monetary policy unchanged as expected, acknowledging the recent slump but maintaining its outlook that the economy would continue to recover moderately. Earlier today, the core machinery orders report printed a surprise 5.7% slide versus the projected 3.3% increase.

Commodity Currencies (AUD, NZD, CAD)

The comdolls carried on with their rallies, despite weaker than expected building permits data from Canada and an increase in oil stockpiles in the US. The latest dairy auction in NZ yielded a 9.9% gain in prices, providing support for the Kiwi throughout the day. Canadian housing starts data is due today, although the return of Chinese traders from their holiday could also spur volatility among higher-yielders today.

By Kate Curtis from Trader’s Way

545

USD

The US dollar gave up ground once more, as the FOMC minutes seemed less hawkish than expected. Fed officials acknowledged that the slowdown in China poses additional uncertainties for the global and domestic economy, although their outlook hasn’t changed materially. Policymakers emphasized that they’d like to see more labor market progress and be reasonably confident that inflation would move closer to its 2% target, but latest reports haven’t been so impressive. For today, import prices data and speeches from FOMC members Lockhart and Evans are lined up.

EUR

The euro took advantage of dollar weakness but was unable to stay afloat against most of its other rivals, particularly the commodity currencies. The ECB minutes seemed to be in line with analysts’ expectations, although ECB member Weidmann reiterated that further easing isn’t warranted just yet. French and Italian industrial production numbers are up for release today and more signs of weakness could mean more losses for the shared currency.

GBP

The pound gave up ground in recent trading, except against the US dollar, thanks to a downbeat BOE statement. The central bank sounded less hawkish than it used to be, as policymakers admitted that the downturn in China led to a weaker inflationary outlook and might lead them to push back their tightening time line. Only one member voted to hike rates as usual while the rest agreed to keep the status quo. The UK trade balance is up for release today and a smaller deficit of 10 billion GBP is expected.

CHF

The franc advanced against the US dollar but was in a weak spot against its other forex rivals, as the Swiss jobless rate ticked up from 3.3% to 3.4% as expected. No other reports were released from Switzerland but the dovish ECB outlook kept franc traders wary of potential intervention from the SNB. There are no reports due from Switzerland today.

JPY

The yen had a mixed performance as it acted mostly as a counter currency, as data from Japan came in mostly weaker than expected. The core machinery orders report showed a surprise 5.7% decline versus the projected 3.3% increase while the Economy Watchers Sentiment index slipped from 49.3 to 47.5. There are no reports due from Japan today, leaving yen pairs sensitive to risk sentiment.

Commodity Currencies (AUD, NZD, CAD)

The comdolls continued with their recent rallies, advancing to the European currencies and safe-havens. Data from Canada was mostly stronger than expected while the pickup in oil prices also added support for the Loonie. Canada is set to print its jobs report today and might show a 10.5K increase in hiring, enough to bring the jobless rate down from 7.0% to 6.9%. Earlier today, Australia reported a meager 2.9% gain in home loans instead of the projected 4.9% increase.

By Kate Curtis from Trader’s Way

546

USD

The US dollar continued to give up ground against its forex counterparts despite stronger than expected data from the economy. Import prices posted a mere 0.1% decline instead of the projected 0.5% drop while the previous reading was revised slightly higher. For today, US traders are off on a Columbus Day holiday, which suggests lower liquidity and potentially higher volatility among dollar pairs.

EUR

The euro advanced against some of its peers on Friday, even though data from the region came in mixed. France reported a 1.6% jump in industrial production while Italy recorded a worse than expected 0.5% slide. There are no reports lined up from the euro zone today, suggesting that pairs could take their cue from market sentiment or stay in range.

GBP

The pound was still in a weak spot last week, particularly against the commodity currencies, due to bleak data from the UK. The trade balance was weaker than expected, as it showed a deficit of 11.1 billion GBP versus the projected 10 billion GBP shortfall while the previous reading was downgraded. Construction output was also weaker than expected with a surprise 4.3% decline. The UK CB leading index is due today, along with a speech by hawkish MPC member Weale.

CHF

The franc was able to regain ground to the dollar on Friday, despite the lack of data from Switzerland. It appears that European traders are looking for a safe-haven alternative, keeping the Swiss currency supported. There are still no reports due from the Swiss economy today, keeping market sentiment in play.

JPY

The yen gave up ground to its forex rivals, as risk appetite improved. There have been no reports out Japan recently, although the earlier ones have been mostly disappointing. Japanese traders are out on a holiday today, suggesting subdued price action during the Asian trading hours.

Commodity Currencies (AUD, NZD, CAD)

The comdolls continued to rally across the forex charts, thanks to improved data. However, the Loonie fell behind when the components of the Canadian jobs report showed a dismal picture. As it turns out, the strong headline figure was simply a result of part-time hiring while full-time employment showed losses. Canadian traders are out on holiday but BOC Governor Poloz has a speech lined up.

By Kate Curtis from Trader’s Way

547

USD

The US dollar had a mixed performance as it acted mostly as a counter currency in recent trading sessions. Low-tier data from the US economy came in somewhat better than expected, with the NFIB small business index rising from 95.9 to 96.1. For today, the top-tier retail sales release is likely to have a stronger effect on the dollar, as the headline reading could show a 0.2% uptick while the core figure could print a 0.1% decline. Also due today are the PPI reports, with the headline figure slated to show a 0.2% decline and the core reading to show a 0.1% uptick.

EUR

The euro regained a bit of ground in recent trading sessions, even though data from Germany came in weaker than expected. The ZEW economic sentiment index plummeted from 19.1 to 1.9, indicating a sharp drop in optimism in the euro zone’s strongest economy. However, the region’s ZEW index still managed to come in line with expectations for a drop from 33.3 to 30.1. Euro zone industrial production and French CPI data are up for release today.

GBP

The pound retreated against its forex peers when the UK headline CPI printed a 0.1% decline instead of the projected flat reading for September. The core figure held steady at 1.0% instead of improving to the estimated 1.1% reading while the PPI showed a stronger than expected 0.6% rise in producer input prices. The UK jobs report is up for release today and a 2.3K drop in joblessness is expected. Traders are also likely to pay close attention to the average earnings index, which might climb from 2.9% to 3.1% and reflect stronger wage inflation.

CHF

The franc was able to advance against its rivals, as traders appear to be seeking an alternative safe-haven currency in the European region. Data from Switzerland came in line with consensus, as the PPI indicated the projected 0.1% dip in producer price levels. The Swiss ZEW economic expectations index is up for release today and a climb from the earlier 9.7 reading might give the franc an additional boost.

JPY

The Japanese yen took advantage of the run in risk aversion, as it raked in gains across the board. Data from Japan was actually weaker than expected, as the consumer confidence index fell from 41.7 to 40.6 instead of just dipping to 41.6. Preliminary machine tool orders fell by 19.1%, worse than the previous 16.5% drop. Earlier today, the Japanese PPI release printed a 3.9% fall in prices as expected.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up more gains in yesterday’s trading, after China printed dismal import figures. The trade surplus was better than expected at 60.3 billion USD versus the projected 46.9 billion USD and the previous 60.2 billion USD, but the components revealed that this was mostly caused by a 17.7% drop in domestic demand. Later on, RBNZ Governor Wheeler hinted that they’re open to “some further easing” even as the country’s dairy industry showed a strong rebound. Earlier today, China printed a weaker than expected CPI of 1.6% instead of the estimated 1.8% figure and worse than the previous 2.0% reading.

By Kate Curtis from Trader’s Way

548

USD

The US dollar gave up a lot of ground to its forex counterparts in recent trading sessions, spurred mostly by disappointing retail sales data. The headline figure indicated a mere 0.1% uptick instead of the 0.2% rise while the core figure showed a 0.3% drop. Producer prices were also weaker than expected, suggesting weaker consumer price pressures down the line and a potentially disappointing CPI release, which might be enough to cast Fed rate hike hopes out the window. CPI reports and manufacturing indices from New York and Philadelphia are lined up today.

EUR

The euro took advantage of dollar weakness but gave up ground to most of its other currency counterparts. Industrial production data was weaker than expected, as the region printed a 0.5% decline instead of the 0.4% drop. There are no reports due from the euro zone today.

GBP

The pound reacted positively to the UK jobs release, even though the claimant count change figure showed a 4.6K increase in joblessness versus the projected 2.3K decline. The jobless rate improved from 5.5% to 5.4% while the average earnings index rose from 2.9% to 3.0%, just short of the 3.1% consensus. No reports are due from the UK today.

CHF

The franc took its cue from the euro and retreated against most of its forex peers, except for the US dollar. Data from Switzerland was actually better than expected, as the ZEW economic expectations index rose from 9.7 to 18.3. There are no reports due from Switzerland today.

JPY

The yen continued to advance against most of its peers, most notably the US dollar. There were no major reports out of Japan but traders seemed to move their safe-haven holdings to the yen instead of the dollar. Earlier today, Japan reported a downgrade in its industrial production report to show a 1.2% decline from the initially reported 0.5% downtick. The tertiary industry index recorded a 0.1% uptick instead of the projected flat reading.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to take advantage of dollar weakness, despite mostly weaker than expected data. In Australia, the employment report showed a 5.1K drop in employment, its first monthly decline since April. The unemployment rate held steady at 6.2% but this was partly spurred by a drop in the participation rate. US crude oil inventories and New Zealand’s quarterly CPI data are up for release next.

By Kate Curtis from Trader’s Way

549

USD

The US dollar regained some ground against its peers on Friday when reports came in line with expectations. Capacity utilization rose 77.5% while industrial production dipped by only 0.1% as expected. The preliminary UoM consumer sentiment report showed a rise to 92.1 from an upgraded 87.2 reading, indicating stronger optimism. For today, FOMC member Brainard is set to give a speech and usually highlights the reasons why the Fed should stand pat.

EUR

The euro gave up ground to most of its forex peers when the final CPI readings confirmed that the region suffered deflation in September. No changes were made to the headline CPI of -0.1% and the core CPI of 0.9%. There are no reports due from the euro zone today, leaving traders to price in expectations for the ECB statement later on this week.

GBP

The pound consolidated to the dollar and regained some ground on Friday, even though there were no major reports out of the UK. For today, there are still no reports lined up, although the weekend release of the Rightmove HPI indicated at 0.6% gain in house prices.

CHF

The franc returned some of its recent wins, as traders probably booked profits off their long trades by the end of the week. Weak inflation in the euro zone increases the odds of further ECB easing, which could mean more intervention from the SNB to keep the franc weak. There are no reports due from Switzerland today.

JPY

The yen struggled to hold on to its recent gains when profit-taking took place by the end of last week. Comments from BOJ Governor Kuroda suggesting that they plan to continue easing until Japan reaches its 2% inflation target kept the yen’s gains limited. There are no reports due from Japan today, although the safe-haven currency appears to be giving up ground after China’s data dump.

Commodity Currencies (AUD, NZD, CAD)

The comdolls made a quick bounce upon seeing the latest reports from China, which indicated that the slowdown wasn’t so bad for now. The GDP showed 6.8% growth versus the projected 6.9% figure and the previous 7.0% expansion while retail sales came in better than expected. Industrial production and fixed asset investment both came in below expectations. In Canada, manufacturing sales and foreign securities purchases beat expectations. Canada’s federal election is scheduled today.

By Kate Curtis from Trader’s Way

550

USD

The US dollar was off to a strong start for the week but wound up giving up some of its recent gains to its peers. FOMC member Brainard reiterated the risks of hiking interest rates too early in her latest testimony, reminding forex market watchers that the Fed liftoff might be delayed to next year. FOMC members Dudley and Powell are set to make speeches today, but the bigger mover could be Yellen’s testimony. Any indication that they’re willing to wait until next year to tighten might mean more dollar weakness.

EUR

The euro gave up ground to most of its peers as the ECB statement drew near. There have been no major reports out of the euro zone yesterday and only the current account balance is lined up today, leaving euro traders to price in expectations for the upcoming monetary policy decision, which might take the negative headline CPI for September into consideration.

GBP

The pound managed to hold its ground against the dollar and advance against some of its rivals despite the lack of top-tier data from the UK yesterday. BOE Governor Carney is set to give a speech today and his monetary policy bias could push the pound in a particular direction.

CHF

The franc continued to edge lower to the US dollar in recent trading sessions, as the currency has been taking its cue from the euro. The Swiss trade balance is up for release today and a smaller surplus of 2.51 billion CHF compared to the previous 2.86 billion CHF is expected.

JPY

The yen was also off to a good start like the Greenback but ended up returning its lead when risk appetite picked up. There were no reports out of Japan but it seemed that Chinese data was enough to spur risk-taking during the Asian trading session. There are still no reports due from Japan today, keeping market sentiment in play.

Commodity Currencies (AUD, NZD, CAD)

The comdolls advanced upon seeing the latest economic figures from China, as these indicated that the slowdown hasn’t been so terrible yet. The GDP indicated 6.9% growth, stronger than the projected 6.8% figure, while industrial production and fixed asset investment missed expectations. The Kiwi also drew additional support from positive expectations ahead of the dairy auction today while the Loonie retreated after the federal election in Canada. Earlier today, the RBA minutes suggested that the central bank is in no rush to cut interest rates, adding a boost for the Aussie. Canadian wholesale sales data is due today.

By Kate Curtis from Trader’s Way

551

USD

The US dollar regained ground against most of its peers in recent trading sessions when Fed head Yellen didn’t exactly show any shift in her monetary policy bias. Other FOMC members reiterated that a liftoff is still possible this year but that it depends on how economic data turns out. Data from the US was mixed, as building permits fell short of expectations at 1.10M while housing starts came in better than expected at 1.21M. For today, data on crude oil inventories and a speech by FOMC member Powell are lined up.

EUR

The euro retreated against its peers when medium-tier data from the euro zone came in worse than expected. German PPI showed a 0.4% drop in price levels while the region’s current account balance showed a much smaller surplus of 17.7 billion EUR. There are no reports lined up from the region today, leaving traders to price in expectations ahead of the ECB decision tomorrow.

GBP

The pound was stuck in consolidation against most of its peers, as traders are waiting for more clues from the UK economy. BOE Governor Carney had a testimony yesterday but barely shared any thoughts on his policy bias. He has another speech lined up today and more hints of what the central bank might do next could push the pound out of consolidation.

CHF

The franc had one of its more volatile days in yesterday’s trading session, as the Swiss currency popped lower against the dollar. Swiss trade balance came in better than expected at a larger surplus of 3.05 billion CHF but the currency gave up ground when data from the euro zone came in weak. This could increase the odds of ECB easing, which might then lead the SNB to intervene in the forex market to keep the franc weak.

JPY

The yen gave up ground against most of its currency counterparts, as traders seemed to favor the US dollar once more. Earlier today, Japan reported a weaker than expected trade balance, as the deficit was mostly unchanged at 0.36T JPY instead of shrinking to the projected 0.07T JPY shortfall. The country’s all industries activity index is due today and might be in for a downside surprise since the tertiary industry activity index fell short.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were off to a good start, thanks to the RBA’s relatively upbeat meeting minutes. However, the Kiwi was forced to retreat when the dairy auction revealed a 3.1% drop in prices, putting an end to the impressive streak of gains in the previous weeks. In Canada, wholesale sales data came in weaker than expected with a 0.1% decline versus the projected 0.2% uptick, setting the stage for a potential retail sales disappointment later this week. For today, the BOC is set to make its monetary policy decision and no actual changes are expected.

By Kate Curtis from Trader’s Way

552

USD

The US dollar advanced against most of its peers as risk aversion seemed to return to the financial markets. There have been no major reports out of the US economy yesterday while today has the initial jobless claims and existing home sales data on tap. The lack of any clear direction among dollar traders could leave the currency moving to the tune of risk sentiment for the rest of the day.

EUR

The euro could be in for a volatile day since the ECB is gearing up to make its policy statement. The central bank admitted that it is open to further easing in their previous statement, and data has fared much worse since. In particular, the headline CPI printed a 0.1% decline in price levels while figures from Germany were mostly disappointing. A dovish bias could send the euro selling off across the board while reassuring remarks could spur a relief rally.

GBP

The pound continued to consolidate against most of its peers, as traders are still waiting for the UK retail sales release. Data from the UK came in better than expected yesterday, as the public sector deficit was smaller than expected. The retail sales report is expected to show a 0.3% gain in spending versus the previous 0.2% uptick.

CHF

The franc took a pause from its recent selloff, as traders are awaiting the ECB rate statement. Even though no actual changes are expected for now, any hints of easing could prompt the SNB to intervene in the forex market to keep the franc weak.

JPY

The yen continued to give up ground against most of its peers when the Japanese all industries activity index showed a 0.2% drop as expected. Data from Japan has been reflecting a slowdown recently, increasing speculations of further easing from the BOJ. No other reports are due from Japan today, keeping risk sentiment in play.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their recent wins after the downbeat NZ dairy trade auction and the BOC statement. Even though the Canadian central bank decided to keep monetary policy unchanged, they downgraded their growth forecasts for the next two years and reiterated that the oil slump could continue to weigh on investment and export activity. Canadian retail sales data is due today and a 0.2% increase in the core figure and a 0.1% uptick in the headline figure is eyed.

By Kate Curtis from Trader’s Way

553

USD

The US dollar regained ground against its peers when risk appetite tanked after the ECB statement. Data from the US came in better than expected, as the initial jobless claims showed a 259K figure versus the projected 266K reading while existing home sales beat expectations at 5.55M. Only the US flash manufacturing PMI is due today and a drop from 53.1 to 52.8 is eyed.

EUR

The euro suffered a sharp selloff across the board when ECB Governor Draghi admitted that they might increase their stimulus program soon. He noted the downside risks to growth and inflation, particularly the downturn in the emerging markets and the euro’s appreciation. He also clarified that they are looking into a range of other options, which suggests that more deposit rate cuts or bond purchases could be announced. Euro zone flash PMI readings are lined up today and weak data from the top two nations could spell more euro declines.

GBP

The pound was able to advance in recent trading sessions, thanks to upbeat UK retail sales data. The report showed a 1.9% jump in consumer spending, outpacing the projected 0.3% growth. Although the previous report suffered a downgrade, traders paid closer attention to the stronger than expected report for September. There are no reports due from the UK today.

CHF

The franc also suffered a sharp selloff, thanks to the downbeat ECB statement. Even though there were no reports out of Switzerland, the currency retreated as traders speculated that the SNB might intervene to keep the franc weak against the euro and its other forex rivals in case the ECB announces more QE or a rate cut. There are no reports due from Switzerland today but the franc might still take its cue from the euro.

JPY

The yen had a mixed performance as it reacted mostly to risk sentiment, gaining ground against the euro but losing to the dollar and pound. There have been no reports out of Japan yesterday while today saw a stronger than expected flash manufacturing PMI reading. The index climbed from 51.0 to 52.5 this month, outpacing the consensus at 50.6.

Commodity Currencies (AUD, NZD, CAD)

The comdolls managed to make a bit of a comeback, as expectations of additional easing from the ECB eased fears of a deeper global economic slowdown. Data from Canada came in mixed, with the core retail sales posting a flat reading and the headline figure indicating a stronger than expected 0.5% gain. Canada’s inflation figures are due today, with the headline CPI set to show a 0.1% drop and the core figure likely to show a 0.3% uptick.

By Kate Curtis from Trader’s Way

554

USD

The US dollar advanced against most of its peers on Friday, as the surprise rate cut by the Chinese central bank spurred a bit of risk aversion. In addition, data from the US was better than expected since the flash manufacturing PMI climbed from 53.0 to 54.1 instead of falling to the projected 52.8 reading. For today, US new home sales data is due and a drop from 552K to 546K is eyed.

EUR

The euro took a break from its sharp selloff when the PBOC decided to ease monetary policy and ease some of the uncertainties in the global market. PMI readings from the euro zone were also mostly better than expected, with the manufacturing and services data from France beating analysts’ projections. The German Ifo business climate index is due today and a drop from 108.5 to 108.1 is eyed.

GBP

The pound held on to some of its wins despite the lack of top-tier data from the UK, as the reports released earlier in the week spelled positive prospects for the UK economy. Only the BBA mortgage approvals report and CBI industrial order expectations are up for release today.

CHF

The franc continued to drop against its peers, as traders speculated that any easing moves from the ECB would be accompanied by intervention from the SNB. There were no reports out of Switzerland on Friday and none are due today.

JPY

The yen had a mixed performance as it mostly reacted to market sentiment instead of establishing its own direction. The Japanese flash manufacturing PMI came in better than expected at 52.5, up from the previous 51.0 figure. There are no reports due from the Japanese economy today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls initially sold off upon hearing more interest rate cuts from China but recovered strongly, as traders predicted that the easing moves might spur trade activity and boost commodity prices. Canadian CPI readings were weaker than expected, as the headline CPI showed a 0.2% decline while the core reading indicated a slower than expected 0.2% uptick. New Zealand’s trade balance is up for release in the next Asian session, with the deficit expected to narrow.

By Kate Curtis from Trader’s Way

555

USD

The US dollar had a mixed performance, as it reacted mostly to risk sentiment and a bit of profit-taking from the recent strong moves. New home sales data from the US was weaker than expected, as the figure landed at 468K while the previous reading was downgraded to 529K. US CB consumer confidence and flash services PMI are lined up for today, along with durable goods orders data.

EUR

The euro continued to weaken against most of its peers, although some signs of retracement have popped up. Data from the euro zone was actually better than expected, with most of the PMI readings from Germany and France surprising to the upside. Only euro zone data on M3 money supply and private loans are up for release today.

GBP

The pound was able to advance in yesterday’s trading sessions, despite weaker than expected BBA mortgage approvals data from the UK. For today, the preliminary GDP reading is up for release and a 0.6% growth figure is eyed. Stronger than expected data could allow the pound to extend its rallies, as this would remind traders that the BOE is still on track to hike rates sometime next year.

CHF

The franc was in a weak spot against most of its peers even though there were no major reports out of Switzerland. The increased odds of additional ECB easing suggests that the SNB might be looking into forex intervention once more in order to make sure the franc stays weak. No reports are due from Switzerland today.

JPY

The yen was able to rake in some gains in recent trading sessions, as risk appetite appeared to weaken. There have been no major reports out of Japan but most economic figures came in the red yesterday, keeping risk aversion in play. There are still no reports due from the country today, which suggests that yen pairs might be sensitive to market sentiment.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their recent wins after the PBOC rate cuts, as traders were unsure whether or not these easing efforts could translate to stronger growth prospects. Data from New Zealand was worse than expected, as the trade balance indicated a wider deficit for September and a downgrade in the August report.There are no major reports lined up from the comdoll economies today.

By Kate Curtis from Trader’s Way

556

USD

The US dollar was all over the place in recent trading sessions, as it functioned as a counter currency. Data from the US economy came in mostly weaker than expected, with core durable goods data, flash services PMI, and the CB consumer confidence index landing short of consensus. Traders might’ve also booked profits ahead of the FOMC statement later today, as this could spark huge moves across dollar pairs.

EUR

The euro struggled to keep its head above water yesterday since there were no reports to neither give it a boost nor push it lower. For today, the German import prices data and GfK consumer climate index are up for release, with another batch of weak readings likely to allow the selloff to resume.

GBP

The pound was in a bit of a weak spot yesterday since the UK printed a weaker than expected preliminary GDP reading. The economy expanded only 0.5% in Q3, slower than the estimated 0.6% growth and the previous 0.7% expansion. There are no reports due from the UK today.

CHF

The franc was able to hold its ground in recent trading sessions, as the lack of top-tier data kept both gains and losses in check. There are still no reports due from the Swiss economy today, leaving market sentiment in control of price action among the franc pairs.

JPY

The yen stayed strong yesterday since risk appetite appeared to weaken. Earlier today, data from Japan showed a 0.2% decline in retail sales instead of the estimated 0.4% uptick, setting the stage for weaker reports later this week. No other reports are lined up for today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up ground earlier when Australia printed a bleak CPI reading of 0.5% versus the projected 0.7% figure for Q3. The RBNZ statement is coming up next, just after the FOMC decision, and no interest rate changes are expected for now. Reassuring remarks from Governor Wheeler might also be enough to keep the Kiwi afloat.

By Kate Curtis from Trader’s Way

557

USD

The US dollar enjoyed a strong rally after the FOMC announcement, as the central bank kept the door open for a rate hike in December. In addition, the Fed upgraded its assessment of business and household spending while sounding less concerned about global growth risks. For today, the US advanced GDP for Q3 is up for release and a 1.6% growth figure is eyed.

EUR

The euro suffered another round of selling to its peers when German import prices printed a sharp 0.7% decline instead of the projected 0.2% dip. Also, the German GfK consumer climate index dropped from 9.6 to 9.4, lower than the expected fall to 9.5. For today, German and Spanish flash CPI readings are due and declines are expected, potentially setting the stage for another weak headline CPI for the entire region. The German unemployment change report is also due today and a 4K drop in joblessness is eyed.

GBP

The pound gave up some of its recent wins, even though there were no reports out of the UK. For today, only medium-tier ones such as net lending to individuals, mortgage approvals, and CBI realized sales figures are lined up. Stronger than expected results could still allow the British currency to recover.

CHF

The franc was one of the weakest currencies in yesterday’s trading sessions, as the Swiss currency is taking its lead from the euro. There were no reports out of Switzerland yesterday and none are lined up today, which means that franc traders might pay closer attention to euro zone data.

JPY

The yen gave up ground to the dollar but was able to take advantage of the run in risk aversion against higher-yielding currencies. Preliminary industrial production data came in stronger than expected with a 1% rise instead of showing the projected 0.5% drop.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up a lot of ground when the FOMC hinted that tightening was still on the table for this year, spurring a drop in commodities. In addition, the RBNZ sounded dovish in their latest rate statement even if they kept rates on hold at 2.75% as expected. In Australia, the quarterly CPI was a disappointment at 0.5% versus the projected 0.7% figure. No other reports are due from the comdoll economies today.

By Kate Curtis from Trader’s Way

558

USD

The US dollar calmed down from its post-FOMC rallies as traders focused on other top-tier data. Besides, the US preliminary GDP reading came in below expectations at just 1.2% growth versus the projected 1.5% expansion. Pending home sales showed a surprise 2.3% decline instead of the expected 1.1% gain. For today, data on personal spending and income are due, along with the core PCE price index.

EUR

The euro struggled to regain a bit of ground in recent trading sessions when data came in mixed. Germany showed a flat preliminary CPI reading, better than the projected 0.1% drop, while Spain showed a worse than expected 0.7% fall in price levels. Germany also reported a larger than expected 5K decline in joblessness, which might mean positive prospects for today’s retail sales release. Traders are likely to pay closer attention to the euro zone CPI estimates, as another negative reading could spur more losses for the shared currency.

GBP

The pound bounced back to action in yesterday’s sessions, thanks to upbeat figures on net lending to individuals. Mortgage approvals and CBI realized sales data both disappointed though. For today, there are no reports due from the UK, rendering the pound sensitive to market sentiment and euro zone data.

CHF

The franc made a bit of recovery in recent trading sessions, as traders probably booked their recent profits. There were no reports out of Switzerland yesterday while today has the KOF economic barometer on tap, although franc traders might pay closer attention to euro zone data and the odds of further ECB easing.

JPY

The yen consolidated against its peers ahead of today’s BOJ statement, although the latest batch of data suggests that the central bank might sound downbeat. Household spending slipped by 0.4% following the previous retail sales disappointment, while both Tokyo and national core CPI figures came in negative. Any signs that the BOJ is willing to expand its easing program could spur yen losses.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to regain a bit of ground in latter sessions, as weak data from the US cast doubts on Fed tightening and put risk appetite back on the table. Earlier today, Australia reported stronger than expected PPI readings, spelling positive prospects for its inflation trends and easing fears of another RBA rate cut. The Canadian monthly GDP is up for release and a 0.1% uptick is eyed.

By Kate Curtis from Trader’s Way

559

USD

The US dollar gave up ground on Friday since most economic figures came in weak. The personal spending and income data indicated a mere 0.1% uptick instead of the projected 0.2% gain while the core PCE price index also logged in a 0.1% increase versus the estimated 0.2% rise. The Chicago PMI came in better than expected at 56.2 versus 49.5 but the UoM consumer sentiment index was lowered from 92.1 to 90.0. The US ISM manu PMI is due today and a drop from 50.2 to 50.0 is eyed.

EUR

The euro managed to recover slightly, thanks to a flat headline CPI estimate for the region. Analysts had been expecting to see another negative reading, which would’ve been enough to confirm additional ECB easing. Other medium-tier reports also beat expectations, with the jobless rate dropping from 10.9% to 10.8% and the core CPI landing at 1.0%, but the consumer spending data from Germany and France fell short. Final manufacturing PMI readings are due from the euro zone nations today.

GBP

The pound was able to hold on to its recent gains despite weaker than expected data from the UK. The GfK consumer confidence index dipped from 3 to 2 instead of improving to the projected 4 reading. The UK manufacturing PMI is due today and a drop from 51.5 to 51.3 is expected.

CHF

The franc made a quick rebound on Friday, even as the KOF economic barometer missed expectations. The reading came in at 99.8 versus the projected 100.1 figure while the previous reading was downgraded to 100.3. Swiss retail sales data is due today and a 0.2% rebound is eyed.

JPY

The yen recovered against its peers when the BOJ refrained from easing policy further. The central bank didn’t appear too concerned about the slump in the Japanese economy, with one policymaker still voting to taper asset purchases. Japanese household spending and housing starts both missed expectations but today’s flash manu PMI came in strong at 52.4 versus 52.1.

Commodity Currencies (AUD, NZD, CAD)

The comdolls appear to be off to a good start, even though reports from China released over the weekend weren’t so impressive. The official manufacturing PMI held steady at 49.8 instead of improving to 50.0 while the non-manufacturing PMI fell from 53.4 to 53.1. However, the Caixin PMI climbed from 47.2 to 48.3, outpacing the consensus at 47.7. No reports are due from the comdoll economies today.

By Kate Curtis from Trader’s Way