Wham bam thank you economic data! Strong U.S. reports and a slide in risk appetite propped up demand for the dollar last Friday. USD/JPY and USD/CHF both inched higher while EUR/USD and GBP/USD broke below strong support levels.
Personal income declined by 3.6% in January, the lowest dip in 20 years. It didn’t stop Americans from spending though, as it remained at a 0.2% rate for the month.
The University of Michigan consumer sentiment further fired up the dollar bulls when it printed a reading of 77.6 in February, higher than January’s 76.3 figure. Heck, even the ISM manufacturing PMI inspired good vibes when it came in at 54.2 in February instead of the expected 52.7 reading.
And then there’s the overall risk sentiment. As I mentioned in my EUR piece, concerns about the euro banks’ LRTO repayments as well as the formation of a coalition government in Italy weighed on the common currency and global risk appetite.
But will the Greenback continue to receive some love from the market players today? Speeches made by FOMC members Janet Yellen and Jerome Powell are the only events scheduled from the U.S. today but keep a close eye on the Eurogoup meetings as well as Spain’s employment numbers due from the euro region as it could affect the demand for the low-yielding Greenback.
Without any economic report from the U.S., the dollar got bullied by its counterparts in yesterday’s trading. It scored losses against all the other major currencies, giving up the most ground to the pound with GBP/USD closing 65 pops higher at 1.5112.
But don’t fret! Some market junkies feel that the dollar’s lackluster performance yesterday was nothing more than just profit-taking. There could be some truth to it, especially since the dollar has been rallying relentlessly against most of its counterparts for the past few weeks.
I can’t help but feel that perhaps the U.S. sequester could have also given investors one more reason to let go of some of their dollars too.
Today, the U.S. ISM manufacturing report for February will be on tap at 3:00 pm GMT and reading of 55.0 is expected. Since it seems like market sentiment is dictating price action, we could see the dollar rally on a worse-than-expected reading as it could spark risk aversion. That’s just my take though!
The Greenback stayed in the bear lair yesterday after a strong U.S. report got mixed in with a little bit of risk appetite. It lost to the euro, pound, yen, and the comdolls and only gained a few pips on the franc. What’s in store for the dollar today?
Unless we see reports that would inspire risk appetite, the dollar will most likely suffer against its higher-yielding counterparts. Yesterday the ISM services PMI clocked in at 56.0, which is a full point ahead of the expected 55.0 reading for February. Since the report is the first employment-related one to be released this NFP week, the currency bulls got excited.
It didn’t even matter that the IBD/TIPP economic optimism data showed weakness. It came in at 42.2 after printing at 47.3 in February. Does this mean that we should watch out for March economic reports? Definitely.
But until we see those reports, we should keep an eye out for the ADP report out at 2:15 pm GMT, followed by the factory orders report at 4:00 pm GMT. Last but not the least is the Fed Beige book report at 8:00 pm GMT. The reports are expected to be more bearish this time around, so be on your toes for upside surprises!
Why, thank you risk aversion! The Greenback got a strong boost from safe-haven flows during yesterday’s trading as the U.S. printed strong economic data while most of the major economies showed signs of weaknesses. Will the dollar be able to hold on to its gains today?
The U.S. ADP non-farm employment change figure came in higher than the consensus at 172K and posted a 198K increase in hiring for February. On top of that, the reading for January was revised up from 192K to 215K, showing that the rise in employment was higher than initially estimated. Although some say that the ADP isn’t an accurate predictor of the NFP results, which are due on Friday, the upbeat jobs figure still made most traders confident that the U.S. labor market continues to rebound.
U.S. factory orders also came in slightly better than expected as the report showed a 2.0% decline instead of the 2.2% drop expected. Meanwhile, the Fed’s Beige Book release showed that policymakers thought the modest economic recovery in the country is supported by strong housing market numbers.
The U.S. is set to print its trade balance for February and its initial jobless claims figure at 1:30 pm GMT today. The trade deficit is projected to widen from 38.5 billion USD to 42.8 billion USD in January, hinting at a downturn in exports for the month. The weekly jobless claims report could show a 354K increase in first-time claimants, but a lower than expected figure could be positive for the U.S. labor market and the Greenback.
Risk appetite was given a huge boost yesterday, thanks to the successful bond auction in Spain and interest rate decisions from the BOE and ECB. The U.S. dollar index, which tracks the performance of the Greenback versus other major currencies, fell to 82.56 after it had opened the day at 82.93.
In addition to the bond auction, S&P also released some good news. It said that it had upgraded Portugal’s BB long-term sovereign rating to stable from negative.
Economic data from the U.S. were mixed.
The U.S. trade balance was worse than expected. It showed that the country’s deficit has widened to 44.4 billion USD in January from 38.1 billion USD in December. It was also slightly lower than the 42.2 billion USD deficit the market had initially forecasted.
Meanwhile, the weekly unemployment claims came in with a positive surprise. It showed that the number of people who claimed for unemployment insurance last week was at 340,000, lower than the 354,000 consensus. It was also an improvement from the previous reading of 347,000.
The Non-Farm Payrolls, the most influential economic report in the forex market, will be released today. It’s going to publish at 1:30 pm GMT and it is expected to show that 162,000 net jobs were created in February. As for the unemployment rate, it is anticipated to have remained at 7.9%.
If the actual number exceeds forecast, we could see the Greenback lose ground, as risk sentiment seems to be the primary driver of price action yesterday. Be careful trading today, folks.
Dollar domination, baby! Strong U.S. NFP figures boosted the Greenback against its major counterparts last Friday as EUR/USD slipped back to the 1.3000 area while USD/JPY surged to the 96.50 minor psychological level. Will the dollar rally continue today?
The February NFP figure came in stronger than expected as it showed a 236K increase in hiring, outpacing the consensus of a 162K climb and the previous month’s 119K reading. This was enough to bring the jobless rate down from 7.9% to 7.7% for the month, a sign that the U.S. jobs sector just might be strong enough to weather the effects of sequestration job cuts later on.
There are hardly any reports from the U.S. for the first half of this week as the top-tier reports such as the U.S. retail sales, CPI, and consumer sentiment data are set for release starting Wednesday. There are no reports due from the U.S. today, which suggests that the U.S. dollar could continue to benefit from the upbeat sentiment resulting from the NFP.
Not exactly the strongest start to the week for the dollar - it gave back some of its gains as traders took a breather from last Friday’s strong rally. At the end of the day, the dollar finished weaker against all of its major counterparts except for the yen.
It seems like the markets aren’t sure if the dollar’s dominance will continue, because they didn’t seem so thrilled about it yesterday. But then again, they might just be saving energy for another dollar rally, and what we witnessed yesterday could turn out to be nothing more than a dead cat bounce.
With no major reports scheduled for release today, it looks we’ll have to trade based on general market sentiment. That being said, I suggest you also track the equities and other markets to get a better feel for the current risk environment. Good luck and happy trading, folks!
With no major data coming out of the U.S., the dollar’s price action depended on its counterparts. EUR/USD ended the day with a stalemate but USD/JPY fell by 28 pips. Cable also registered a 16-pip loss after recovering from its 1.4831 intraday low.
The dollar gained some support early in the day when weak data from the U.K. and rumors of additional capital demand from the euro zone’s banks sparked risk aversion. The high-yielding currencies found support at technical levels though, and were able to pare their losses by the end of the day.
Let’s see if the Greenback can steal back the show today. At 12:30 pm GMT Uncle Sam will print its retail sales figures, which is expected to show faster growth rates than the previous month’s numbers. Since the NFP report blew expectations out of the water, market geeks are betting for good consumer buying data.
At around 2:00 pm GMT we’ll also see the business and oil inventories data, but the next potential market mover won’t be up until 6:00 pm GMT when the Fed’s budget balance report is released. Analysts are expecting a deep budget deficit so don’t even think of missing this report!
Like a bawse! The dollar showed everyone who the top dog is in the forex markets as it trounced its higher-yielding counterparts. Thanks to solid retail sales figures, the dollar index rose from 83.05 to 83.38 to reach levels not seen since August 2012. Crazy!
The signs of recovery just keep coming for the U.S.! Following last Friday’s upbeat employment numbers, we got news that February U.S. retail sales performed much better than expected. The headline figure showed a 1.1% rise (versus 0.5% forecasts) while the core figure revealed a 1.0% increase (versus 0.5% forecasts). What’s most impressive about this is that it happened amidst rising taxes and gas prices. Not surprisingly, this lifted demand for the dollar, as it suggests that the U.S. recovery is picking up some serious steam.
Will today’s reports extend the U.S.'s string of positive reports?
At 12:30 pm GMT, we’ll get served a slew of reports. Unemployment claims are expected to come in at 348,000, up from 340,000 last week. Headline PPI is seen at 0.7% up from 0.2%, while core PPI is expected to stay at 0.2%. And lastly, the current account deficit is anticipated to widen from 108 billion USD to 111 billion USD. If these reports all print better-than-expected results, I wouldn’t be surprised to see the dollar extend its rally!
Woah, what a selloff! The U.S. dollar lost ground to its major counterparts during the U.S. session as risk sentiment seemed to make a comeback in the markets. EUR/USD rallied back to the 1.3000 major psychological resistance while GBP/USD reached the 1.5100 area. Was all that just a short squeeze?
Data from the U.S. was actually better than expected yesterday as the initial jobless claims figure came in at 332K, lower than the estimated 348K increase in first-time claimants. Meanwhile, PPI figures met expectations as the headline figure showed a 0.7% uptick while the core version of the report printed a 0.2% rise.
Instead of trading on fundamentals, wherein strong U.S. data typically leads to a dollar rally, the U.S. dollar seemed to move according to risk sentiment. In this case, traders dumped the Greenback in exchange for higher-yielding currencies as positive data made them hungry for more risk.
For today, the U.S. is set to print its CPI data, the Empire State manufacturing index, and the preliminary UoM consumer sentiment figure. The headline CPI is expected to come in at 0.6% while the core CPI could show a 0.3% uptick. The Empire State index is projected to dip from 10.0 to 9.8 in March, reflecting a slight drop in manufacturing activity for the month. Lastly, the consumer sentiment report could show an improvement from 77.6 to 78.2 for the current month.
Be extra careful when trading these reports as the U.S. dollar seems to be reacting to risk appetite. Stronger than expected figures might be bearish for the dollar while weak ones could trigger a safe-haven rally. Stay on your toes!
Wipeout! Most of the Greenback’s recent gains were erased last Friday as EUR/USD rallied to the 1.3100 handle while GBP/USD reached a high of 1.5176. Will we see more dollar weakness this week?
U.S. economic data came in mixed last Friday as the CPI figures were closely in line with expectations while the Empire State manufacturing index and University of Michigan consumer sentiment reading fell short. The headline CPI posted a 0.7% increase, slightly higher than the estimated 0.6% uptick, while the core version of the report showed a 0.2% rise as expected. The Empire State manufacturing index slipped from 10.0 to 9.2 in March, lower than the estimated drop to 9.8, revealing that expansion in the manufacturing industry slowed down more than the forecast. Meanwhile, the the consumer sentiment figure for the current month tumbled from 77.6 to 71.8, way below the predicted 78.2 reading.
These not-so-good figures may have worsened the ongoing U.S. dollar selloff towards the end of the week as these show that the U.S. economy isn’t as strong as many had hoped. This week’s FOMC statement, which many are waiting for, could shed more light on how the U.S. economy is doing and how the Fed plans to manage monetary policy in the near term. Make sure you watch out for that on Wednesday!
For today, there are no major reports on the U.S. economic calendar, which could mean a bit of quiet trading to start the week. Keep your eyes and ears peeled for any changes in market sentiment though!
What a crazy start to the week! With all the hoopla surrounding Cyprus, dollar pairs pretty much stuck in consolidation as nobody is quite sure what will happen next. EUR/USD closed at 1.2931, down 7 pips from its opening price, while GBP/USD finished 23 pips lower at 1.5096.
EUR/USD actually gapped down over 100 pips to start the week as a major uproar about the potential depository tax that will be implemented on Cyprus’ bank depositors. We did see some relief yesterday, but lets see how long that lasts. Make sure you hit up my EUR commentary as well as my buddy Forex Gump’s latest piece for more details on this situation.
For today, we’ve got U.S. housing data headed our way at 12:30 pm GMT in the form of building permits and housing starts. Take note that this has been trending higher the past 6 months or so, so it’s no surprise that we should see building permits rise from 900K to 930K, and housing starts to increase from 890K to 920K. If we see even better-than-expected results, it could lead to a nice dollar rally during the New York session.
Like my homegirl Alicia Keys, the dollar was on fire in yesterday’s trading! Risk aversion sparked by concerns about Cyprus sent investors scurrying towards the dollar and the yen. EUR/USD finished lower at 1.2889 after opening at 1.2931. Meanwhile, AUD/USD closed with a 21-pip loss at 1.0371.
The Cypriot Parliament voted whether or not to impose the levy proposed in the government’s bailout deal. Unfortunately, a consensus was not reached and the levy was rejected. This, in turn, only fueled risk aversion even further, sparking demand for “safe haven” assets such as the dollar.
Today will be a big day for the dollar with the Fed scheduled to announce its rate decision later at 6:00 pm GMT.
No changes are expected on the central bank’s official cash rate and asset purchases. However, what could make this interesting would be Fed Reserve Chairman Ben Bernanke’s remarks about the economy.
Hopes are high that the head honcho would acknowledge the recent improvements in economic growth. If he decides to take a more pessimistic tone and focus on the potential effects of the sequester though, we could see the dollar get sold off.
Today could prove to be another wild Wednesday on the charts, so make sure you don’t miss the FOMC statement later, ayt?
Risk on, baby! With risk appetite making a comeback, the dollar found itself getting bullied by other currencies. Even with the help of the FOMC statement, it lost ground to all of its major counterparts save for the yen and Kiwi. Will it stage a comeback today?
The FOMC statement came and went, but it didn’t quite give the dollar the boost many were expecting. Don’t get me wrong, it was dollar bullish, alright. But it didn’t do enough to erase all of the dollar’s losses from the risk rally that took place earlier in the day.
Not surprisingly, the Fed decided to keep monetary policy unchanged again. But what many found interesting was how chill Fed head Ben Bernanke sounded about the outlook for the U.S. He didn’t seem to be too bothered about the effects that the automatic spending cuts would have on the economy, even though the Fed had downgraded its growth forecast for 2013 from 2.3%-3.0% to 2.3%-2.8%.
What’s funny is that he even found the time to discuss positive improvements in the job and housing markets. And get this, he brought up the idea of varying the central bank’s 85 billion USD monthly asset purchases a few times too!
Bernanke’s relaxed tone shows how much confidence he has in the economy. And while the Fed doesn’t have plans of withdrawing its QE program YET, a few more months of positive results might shift the Fed’s stance on monetary policy altogether.
Coming our way later in the New York session are a few more reports. First up is the weekly unemployment claims report due at 12:30 pm GMT. Look claims to hit 343,000, up from 332,000 last week. Then at 2:00 pm GMT, we’ll take a peek at existing home sales data and the Philly Fed manufacturing index. Word on the street is that existing home sales rose from an 4.92 million to 5.02 million last month, while the Philly Fed index is expected to tick up from -12.5 to -1.6.
If these print strong results, it could help the dollar recover some more. Don’t miss 'em, dawg!
The Greenback’s price action was as assorted as Cyclopip’s trail mix as it gained on the euro and the franc but lost to the yen and the pound. The U.S. printed strong reports yesterday so what else could have influenced the dollar’s performance?
As it turned out, the dollar traded on both risk appetite and economic reports. The Greenback got a boost when the initial jobless claims printed lower and brought its 4-week average to a 5-year low. It also didn’t hurt that the manufacturing PMI and the Philly Fed index printed to the upside. The dollar bulls were in such a good mood that they even shrugged off the disappointing new home sales data!
Unfortunately, the dollar had competition when it comes to optimism. Positive Chinese data spurred the comdoll bulls into action while upside surprises from the U.K. limited the dollar’s gains against its European counterparts.
The U.S. won’t be releasing any economic report today so the Greenback will most likely trade on risk sentiment. Keep an eye out for any word on Cyprus, will ya? Something tells me that it’s the markets aren’t done fixating about that just yet.
The financial turmoil in Cyprus might have been the focus last Friday, but that did not stop the European currencies from pummeling the safe haven Greenback to the ground. The U.S. dollar, in a surprising turn of events, lost against almost all the European currencies, including the euro, the pound, and franc.
The most recent development regarding Cyrpus is that the parliament has finally approved three new measures to secure a bailout. This, of course, was positive for risk sentiment.
No major economic news report were released last Friday from U.S. but we’ve got a couple this week tier 1 data that are likely to create a lot of action in the charts. On Tuesday, for instance, the U.S. durable goods orders, the CB Consumer Confidence survey, and the New Home Sales report will publish.
On Wednesday, the Pending Home Sales report will come out. It’s anticipated to show a 0.4% decline, opposite the 4.5% increase seen the previous month. And finally, on Thursday, the third and final revision of the Q4 2012 GDP is due. Analysts believe that the economy actually 0.5%, much larger than initially expected.
With Cyprus’ financial troubles dominating the headlines, this week could prove to be a wild one. Make sure you keep tabs on the ever-shifting market sentiment, as it will likely be the one to dictate price action.
Mixed day for the scrilla, as it sliced and diced its way against the euro but failed to gain any momentum against the comdolls. With some hot reports headed our way during the New York session, what could be in store for the dollar today?
The Greenback rallied hard against the euro as the markets didn’t react positively to the news that Cyrpus finally agreed to a deal. Make sure you go through my EUR commentary for the 411 on this hot topic!
In other news, Big Boss Bernanke stepped up to the plate and talked about monetary policy. Unfortunately, he didn’t have any surprises for us this time around, as he basically said that recent moves by central banks around the world have helped give growth support and that inflation remains subdued.
For today, we could see some wild moves on dollar pairs, as we’ve got some red flags on tap.
First, at 12:30 pm GMT, durable goods orders will be released. Expectations are that headline durable goods orders grew by 3.9%, while core orders increased by 0.7%. Take note that this report has beaten forecast the past 5 months, so there’s a chance we’ll see the same today.
Later on at 2:00 pm GMT, both the CB consumer confidence and new home sales figures will be made available. Consumer confidence is seen to have dropped slightly and is expected to have a reading of 67.9, down from the 69.6 from last month. Meanwhile, the annualized pace of new home sales is projected to have scaled down from 437,000 to 426,000.
Should all these reports print in the green, it could give the dollar bulls the boost they need to continue to surge versus the euro, and possibly to gain momentum against the comdolls.
Yesterday, the U.S. dollar replicated its performance from the day before as it traded in a mixed manner in the foreign exchange market. The Greenback managed to range versus the euro, but gained slightly against the pound and the yen.
Tier 1 data released from the U.S. generally disappointed. The U.S. durable goods orders showed that even though the headline figure rose 5.7%, the core version, which is more closely watched, failed to meet forecast and reported a 0.5% decline. The market had initially projected a 0.7% growth.
Meanwhile, the CB Consumer Confidence survey printed a reading of 59.7, significantly lower than the 67.9 consensus. And finally, the new home sales showed that 411,000 (annualized) new homes were purchased in February. The estimate was 426,000 homes.
Today, the only major report on the data cupboard is the pending home sales. It’s anticipated to show a 0.3% decline in sales in February after January’s strong 4.5% rise. Normally, declining pending home sales is negative for the currency. However, given the current market environment, bad data could actually help the dollar due to risk aversion.
Aaah, there’s nothing like a dash of risk aversion to get the dollar dashing through the charts! As concerns about a potential bank run in Europe mount, demand for safe haven assets such as the dollar also picked up. Save for the yen, the currency finished with wins against all its other major counterparts.
Of course, it also helped the dollar that Fed officials sounded optimistic in their speeches yesterday. Fed President Kocherlakota pointed out the improvement in the labor market while Fed President Rosengren, who has been known as a dove, said that the Fed could take a step back in providing the economy with stimulus.
Given the Fed’s newfound optimism for the economy as well as the risk averse market environment, traders didn’t even seem to mind the disappointing pending home sales figure for February. Data shows that sales contracted by 0.4% during the month, 0.1% more than the market consensus.
I wonder if the dollar will be able to get away should today’s roster come in worse than expected though. Later at 12:30 pm GMT, unemployment claims will be on tap and a reading of 340,000 is expected and also, the final version of the Q4 2012 GDP is seen to match its previous reading of 0.5%.
Then at 1:45 pm GMT, the Chicago PMI is anticipated to come in at 86.5.
Better-than-expected figures could fuel the dollar’s rally further while negative ones could get it sold off. Make sure you don’t miss 'em!
With most of the major economies on a Good Friday bank holiday, the dollar didn’t make any significant moves against its counterparts. But check out what happened to the Greenback last Thursday!
Lack of panic in the euro region as well as poor U.S. economic data weighed on the dollar as it encouraged investors to buy higher-yielding currencies. EUR/USD jumped by 46 pips; Cable went up by 66 pips, and USD/CHF fell by 52 pips last Thursday. What a wipeout!
As I mentioned in my EUR piece, strict capital controls in Cyprus’ banks prevented bank run when its banks opened after a couple of days of holidays. Of course, it didn’t help the dollar that the upward revision on the U.S. GDP was less than markets had expected while the Chicago PMI fell from 56.8 to a reading of 52.4.
Last Friday the personal spending, personal income, and revised UoM consumer sentiment data all came in better-than-expected. Unfortunately, most of the major economies were on a Good Friday holiday and no one was trading the reports.
Will the Greenback start Q2 2013 strong? It’s NFP week, baby! Though we have a couple of employment-related reports due this week, we’ll only see the final manufacturing PMI today at 1:00 pm GMT followed by the ISM manufacturing PMI at 2:00 pm GMT. Keep an eye out for any surprises!