[B]Market Review[/B] - 02/11/2013 [I]01:41GMT [/I]
[B]Dollar strengthens broadly on strong U.S. data[/B]
Dollar strengthened broadly against its major peer currencies on strong U.S. Markit PMI and ISM manufacturing data, which fuelled speculation that the Fed may start tapering stimulus sooner than expected.
U.S. ISM manufacturing in October came in at 56.4, stronger than the economists’ forecast of 55.0. U.S. Markit PMI in October came in at 51.8, better than the expectation of 51.1.
The single currency met selling interest at 1.3590 in Asian trading and ratcheted lower in European session. Euro later tanked to a session low at 1.3478 (Reuters) in New York afternoon due to strong U.S. economic data.
Versus Japanese yen, the greenback initially fell to a session low at 97.80 in Asian trading but renewed buying interest there lifted price higher in European session due to the rebound of Nikkei futures. Dollar further rose above Thursday’s top at 98.69 to session high at 98.86 in New York morning after the release of strong U.S. economic data before stabilizing.
The British pound met selling interest at 1.6046 in Australian morning and then tanked to 1.5953 in European session in part due to the release of weaker-than-expected U.K. manufacturing PMI in October which came in at 56.0, worse than the forecast of 56.4, previous reading was revised to 56.3. Cable later fell to an intra-day low of 1.5908 in New York afternoon due to dlr’s broad-based strength on strong U.S. economic data.
In other news, Federal Reserve Bank of St. Louis’s President James Bullard says ‘any decision to scale bank bond buying will be data-dependent; likelihood of tapering will continue to rise as labor market continues to show cumulative improvement; would like to see inflation come back up toward target before tapering bond buying; inflation continues to run very low in the U.S. economy; will not speculate on a taper decision in December, says Fed should keep its options open at every meeting.’
Federal Reserve Bank of Philadelphia’s Charles L. Plooser says ‘could support setting a limit for bond-buying program; could announce a dollar size to QE3 that would halt it soon; “very high” hurdle for increasing rate of bond buying.’
[B]Data to be released next week: [/B]
Australia retail sales, house price index, Italy manufacturing PMI, France manufacturing PMI, Germany manufacturing PMI, EU manufacturing PMI, Sentix investor confidence, U.K. construction PMI, U.S. factory orders, durable goods on [B]Monday. [/B]Japan financial market is closed due to public holiday.
Australia RBA rate decision, China HSBC Markit service PMI, Swiss CPI, U.K. BRC retail sales, service PMI, EU PPI, Canada trade balance, exports, imports, U.S. Redbook retail sales, ISM non-manufacturing on [B]Tuesday. [/B]
New Zealand unemployment rate, employment change, Australia trade balance, U.K. BRC shop price index, industrial production, manufacturing production, Italy service PMI, France service PMI, Germany service PMI, factory orders, EU service PMI, retail sales, Canada building permits, Ivey PMI, U.S. leading indicators on [B]Wednesday. [/B]
Australia employment change, unemployment change, Japan leading indicators, U.K. Lloyds employment confidence, BOE rate decision, BOE asset purchase target, Germany industrial production, ECB rate decision, U.S. GDP, personal consumption, PCE core, jobless claims on [B]Thursday. [/B]
China trade balance, export, import, Swiss unemployment rate, retail sales, U.K. trade balance, Germany current account, export, import, trade balance, France current account, trade balance, industrial production, manufacturing production, Canada housing starts, net change in unemployment, unemployment rate, U.S. personal income, personal consumption, PCE index, PCE core, non-farm payrolls, private payrolls, unemployment rate, average hourly earnings, University of Michigan consumer confidence on [B]Friday.[/B]