The dollar bears must have gathered their strength over the weekend because they outnumbered the bulls in yesterday’s trading. USD/JPY slipped by 22 pips while EUR/USD jumped by 29 pips. What’s up with that?!
No major U.S. report was released yesterday, so investors got busy dealing with rising bond yields and falling equities across the globe. All the hoopla apparently provided the dollar bears time to recoup as many high-yielding currencies pared back their losses against the Greenback.
Will the U.S. reports due today provide the dollar the opportunity to reclaim its title as king of pips? At 12:30 pm GMT we’ll see the durable goods orders, which is expected to print lower than last month’s reading.
The report will be followed by S&P’s house price index at 1:00 pm GMT and the CB consumer confidence, new home sales, and Richmond manufacturing index at 2:00 pm GMT. The consumer confidence data could give clues on future consumer activity, so pay close attention to these U.S. session reports!
Even though there were several red flags on the U.S. economic calendar yesterday, the Greenback was unable to choose a clear direction. The U.S. dollar index that reflects the currency’s strength against a basket of majors more or less moved sideways after opening the day at 82.89. It found support at 82.71 and resistance at 83.09.
The economic reports that were released were mostly positive.
First, the Durable Goods Orders showed a 3.6% increase, which was much better than the 3.0% rise the market initially forecasted. The core version of the report also posted a gain; specifically a 0.7% increase, which was higher than the 0.0% consensus. Second, the S&P/CS Composite House Price Index reported that the average selling price of homes shot up 12.1%, which is also slightly higher than the estimate of 10.6%.
Third, the CB Consumer Confidence survey published a reading of 81.4. The estimate was for a reading of 75.2. And finally, the New Home Sales report showed that the annualized number of new houses sold for the month of May grew to 476K from 466K. It was notably better than the consensus of 462K.
Unlike yesterday, the U.S. economic docket will be light today. No tier 1 data is scheduled for release as only the third and final version of its Q1 2013 GDP will publish. It’s going to come out at 12:30 pm GMT and is anticipated to confirm the 2.4% growth rate calculated in the second GDP estimate.
Talk about being confused! It seems as though the dollar didn’t know which way to go in yesterday’s trading, as it racked up pips against the euro, yen, pound, and Swissy, but weakened against the comdolls.
Just when we thought the U.S. didn’t have any more surprises up its sleeves, it comes out and publishes its final GDP report with shocking results. The U.S. had to revise its Q1 2013 growth estimates downward from 2.4% to just 1.8%!
As it turns out, the increase in payroll tax had a lot more bite to it than previously estimated. It took a big chunk out of household purchases, which was revised down from 3.4% to just 2.6% last quarter. With consumer spending contributing about 70% of the country’s output, this certainly ain’t good news for the U.S. Some say that it’s a clear sign that the Fed is making a mistake by considering an exit strategy this early on.
Not surprisingly, the dollar sold off as the markets caught sight of the disappointing GDP figures. But on most pairs, the sell-off was short-lived. Does this mean that they’re gearing up for another dollar rally?
That might be the case if the jobless claims report, due at 1:30 am GMT, prints strong results. Forecast has it showing a total of 347,000 claims, down from the previous week’s record of 354,000.
Then at 3:00 pm GMT, we’ll take a look at the pending home sales report, which is slated to reveal an increase of 1.1%, up from 0.3%. Should these reports disappoint in the same way that yesterday’s GDP report did, it could force the dollar to trade lower. Stay on your toes, folks!
Now, that’s much better! After printing a mixed scorecard on Wednesday, the dollar traded with clearer direction on Thursday. It actually finished the day with wins against all of its counterparts save for the euro. EUR/USD bounced off 1.3000 on the heels of positive euro zone data.
Positive data from the U.S. helped boost the dollar. The unemployment claims report continued to show a drop in the number of people filing for unemployment benefits at 346,000 last week from 355,000 the week prior. Meanwhile, personal spending and income rose by 0.3% and 0.5%, respectively.
The core PCE index, said to be the Fed’s preferred gauge of inflation, printed a 0.1% uptick after coming in flat the month prior.
However, some of the positive vibes that might have been brought about by the positive economic figures could have been dampened by Fed official Dudley. There were two other Fed officials who spoke yesterday too. They all reiterated Bernanke’s remarks that the Fed could taper within the year. However, Dudley clarified that this decision will be dependent upon the outcome of economic data and not the calendar.
With that said, we’ll probably see economic data have more impact on the dollar. So make sure you’re always on your toes for them!
Today, the Chicago PMI (seen at 55.0) is due at 1:45 pm GMT while the final University of Michigan consumer sentiment index (eyed at 83.0) is scheduled at 1:55 pm GMT.
And that’s how you end the month with a bang! The U.S. dollar capped off the month of June with a strong rally against its major counterparts. AUD/USD made a new yearly low while EUR/USD retested the 1.3000 handle. Will July be kind to the dollar as well?
U.S. data came in mixed last Friday, as the Chicago PMI fell short of expectations while the revised UoM consumer sentiment figure came in strong. The Chicago PMI slipped from 58.7 to 51.6 in June, lower than the estimated reading of 55.5. Meanwhile, the UoM consumer sentiment index was revised up to 84.1, better than the projected 83.1 reading. This goes to show that, although the manufacturing industry has seen signs of weakness, improvements in the consumer sector could continue to provide support for the U.S. economy.
For today, the U.S. ISM manufacturing PMI is the only red flag on the U.S. schedule. This report, which is due 3:00 pm GMT, is expected to print a rebound from 49.0 to 50.6. After contracting in May, the manufacturing industry is projected to show an expansion for June, which could give the dollar a boost in today’s trading.
By Wednesday, the non-manufacturing component of the ISM report is due and is also expected to show an improvement for June. U.S. banks will be on a Fourth of July holiday on Thursday but the fireworks could continue on Friday, as the non-farm payrolls report is set for release. Quite an exciting week for the dollar, don’t you think?
Try again next time! Uncle Sam’s better-than-expected report yesterday didn’t do the Greenback any favors as it finished the day with mixed results against its counterparts. USD/JPY just missed the 100.00 handle, but USD/CHF, GBP/USD, and even EUR/USD all showed USD weakness.
The ISM manufacturing PMI report should have provided the dollar bulls a push when it rose back to an expansionary reading of 50.9 in June after falling to an index figure of 49.0 in May. Unfortunately for the dollar, the NFP geeks paid more attention to the employment component of the report, which fell to 48.7 in June, its lowest reading since September 2009.
But don’t fret! The dollar has a couple of chances to recover today, starting with the factory orders and the IBD/TIPP economic optimism data due at 2:00 pm GMT. Both reports are expected to show stronger figures than their reading last month, but keep an eye out for possible downside surprises!
Who is everyone calling weak now?? Most defo not the dollar! After a dismal start to the week, the Greenback pared all of its losses to its counterparts yesterday. USD/JPY strongly broke past the major 100.00 level with a massive 106-pip gain at 100.65. Meanwhile, EUR/USD resumed its drop, closing well below 1.3000 at 1.2976.
It would seem that the dollar managed to hustle some muscle as investors giddily anticipate the NFP report for June which is due this Friday. I wonder if the currency will be able to sustain its rally today with a roster of reports on tap from the U.S.
At 12:15 pm GMT, the ADP non-farm employment change report for June will be released. It is considered to be a leading indicator of the NFP, and so, a figure lower than the 161,000 forecast could send the dollar lower. It will be released alongside the U.S. trade balance (seen at -40.3 billion USD) and unemployment claims (eyed at 345,000) reports.
Then at 2:00 pm GMT, the ISM non-manufacturing PMI will be released. The headline figure is seen at 54.3 but also keep an ear out for its employment component as it could also get some attention from the markets. Good luck!
After several days of wins, the Greenback took a nasty turn and fell against most major currencies yesterday. The U.S. Dollar Index that measures the strength of the Greenback with respect to a basket of foreign currencies declined to 83.67 from 84.05.
What caused the sudden sell-off?
Mixed data, apparently. Even though ADP’s non-farm employment change beat expectations (188K actual versus 161K forecast), both the U.S. Trade Balance and the ISM Non-Manufacturing PMI were weaker than expected. The Trade Balance showed a huge 45 billion USD deficit, which was higher than the 40.3 billion deficit initially predicted. Meanwhile, the ISM Non-Manufacturing PMI printed a reading of 52.2, more than two points lower than consensus.
Taken together, the news reports released reflected an economy that is neither strong nor weak, creating doubts as to whether the Fed will truly start tapering its massive open-ended quantitative easing program before the year ends.
The U.S. banks will be closed today due to the Independence Day, so no economic reports on the docket. Nevertheless, don’t think that volatility will be nonexistent just because liquidity is low. In Europe, two major central banks are scheduled to announce their decisions on interest rates. Those are major events that could have a serious impact on the Greenback’s price action.
After taking a nasty tumble on Wednesday, the dollar got back on its feet to post solid wins against all of its major counterparts save for the Aussie and the Kiwi. Will today’s NFP report send it higher?
The fourth of July may be behind us, but that doesn’t mean we won’t see fireworks today. We have ideal conditions for explosive moves given that U.S. traders will be returning from a bank holiday and the much-anticipated NFP report will be coming out.
According to analysts, today’s employments stats will likely keep the Fed on track to wind down its asset purchases. An increase of 163,000 jobs is expected, following up last month’s gains of 175,000. Meanwhile, the unemployment rate is expected to trickle down from 7.6% to 7.5%.
Do yourself a favor and tune in when these reports come out at 12:30 pm GMT. Strong results could boost the dollar higher, while a weak showing from the job market will likely lead to a broad-based dollar sell-off.
Now that’s how you end the week with a bang! Thanks to some solid NFP figures, the dollar rallied up the charts, as it dominated the rest of the major currencies. Can the scrilla sustain its good fortune to start the week?
Non-farm payrolls checked in at 195,000, which was substantially greater than the anticipated 163,000 forecast. Furthermore, last month’s 175,000 number was revised up to 195,000, indicating that the labor market is gaining steam. Meanwhile, the unemployment rate remained steady at 7.6%.
Naturally, this helped boost the dollar, as it gives the Fed more reason to start tapering off asset purchases later this year.
No hard data on tap over the next couple of days, so let’s see if the USD bulls can sustain their momentum. Watch out for any comments from FOMC members, as any mention of the central bank’s plans could send the markets into a frenzy.
The dollar bulls took a chill pill yesterday as the Greenback pared back some of its gains against its counterparts. EUR/USD ended up with a 59-pip uptick while USD/JPY also slipped by 14 pips. What’s up with that?!
One possible reason for the dollar’s losses is a bit of profit-taking ahead of the FOMC minutes. Since the Fed had already said that it’s planning to taper its asset purchases, analysts aren’t expecting anything new for this month’s minutes.
Another possible reason is the lack of U.S. data. As you can see on our economic calendar, other major economies like Australia and the euro zone have some more interesting reports on deck, so traders might have taken out their dollar positions in favor of trading the other currencies.
Uncle Sam’s schedule will be no more fun today than yesterday as we only have the NFIB small business index on tap. The report is expected to print a reading of 96.6, a notch higher than last month’s 94.4. I don’t think that the report’s impact will last though, so keep an eye out for any major report that might spur on the dollar bulls and bears!
Brace yourselves, fellas! The Greenback could continue its wild ride in the forex charts today, as the FOMC meeting minutes are about to be released. So far, EUR/USD has dipped below the 1.2800 handle while GBP/USD is trading around 1.4850.
There were no major reports released from the U.S. yesterday, leaving the Greenback at the mercy of risk sentiment and currency-specific data. Fortunately for the dollar, risk aversion lingered in the markets for the past few trading hours, as euro zone debt concerns started to dominate the airwaves once more.
The upcoming release of the U.S. FOMC meeting minutes could lead to stronger moves by the dollar since this report would shed light on why Fed policymakers believe that they should start tapering as early as Q4 this year. If the minutes reveal that most Fed officials support this plan, the dollar might be able to extend its gains. On the other hand, if the minutes show that a good number of policymakers are still wary about reducing stimulus, the dollar could return some of its recent wins. Stay on your toes for the actual release at 7:00 pm GMT.
The dollar was as lost as an elephant in the city during yesterday’s trading. It would seem that the FOMC meeting minutes provided more confusion than clarity to traders, causing the dollar to give up some of its gains.
EUR/USD finished higher at at 1.2979 after opening at 1.2786. Meanwhile, USD/JPY was down 85 pips at 100.18 by the end of the day.
According to the minutes of the Fed’s most recent meeting, policymakers are intent on putting an end to the Fed’s bond-buying soon. However, the very big question is, when?
There are those who echo Fed Chairman Ben Bernanke’s remarks that it might happen this year. On the other hand, there are “many” others who feel that tapering shouldn’t happen until 2014.
It seems to me that those who are skeptical about withdrawing stimulus this year are still worried about the labor market. With that said, we shouldn’t be surprised to see jobs-related data get more attention from the markets.
That includes the unemployment claims report for last week which is due to be released later at 12:30 pm GMT. The forecast is for a reading of 342,000. Look for a lower-than-expected reading if you plan on buying the dollar!
The dollar fell deep into the bears’ lair yesterday as EUR/USD popped up by a ridiculous 219 pips on the same day that GBP/USD registered a 276-pip gain and USD/CHF fell by 199 pips. What gives?!
It’s the FOMC minutes, of course! Traders still reacted to the latest Fed statements, which signaled that Fed members are still willing, but are very very cautious about tapering their asset purchases. Not only that, but Bernanke even followed up with a few words about keeping their monetary policy accommodative for a long period of time. Last but not the least, it didn’t help that the initial jobless claims report released yesterday printed at a seven-week high. Yikes!
Today Uncle Sam is set to release its PPI report at 12:30 pm GMT, followed by the UoM consumer sentiment data at 1:55 pm GMT. Both reports are expected to print slightly stronger numbers than last month’s releases, so watch out for any volatility in case they come out weak!
After two days of getting pummeled on the charts, the dollar clawed its way back into green territory and ended last Friday with small gains against its major counterparts. While EUR/USD lost 34 pips to finish below the 1.3100 handle, USD/JPY recorded a 45-pip gain and ended above 99.00.
The dollar’s victory last Friday was anything but easy. It had to contend with disappointing University of Michigan consumer sentiment data, which revealed a slight downturn in confidence in early July. The index printed a reading of 83.9, down from 84.1 last month. Some say that the fear of higher interest rates is what’s dragging down consumer sentiment. If that’s the case and consumer sentiment continues trending lower in the coming months, then the Fed may have to reconsider its stance on monetary policy.
This week, we’ve got quite a lot of U.S. reports to look forward to, starting with retail sales data at 12:30 pm GMT today. The headline figure is slated to show a 0.7% increase, up from 0.6% in the previous month. Meanwhile, the core figure is anticipated to print at 0.2%, down from 0.3%. Tier 1 reports like this tend to set the tone for dollar trading, so do yourself a favor and don’t miss this release!
Not so fast, boys! Just when we thought that we would be seeing another dollar domination, a few weak economic reports pushed EUR/USD and GBP/USD off its lows and dragged USD/JPY and USD/CHF off their highs. What gives?
Blame it on the U.S. retail sales data! The headline figure came in flat in June, which is way less than the expected 0.5% growth and last month’s 0.3% reading. The core figure also disappointed expectations with only a 0.4% growth instead of the expected 0.7% uptick and suggests that U.S. consumers are saving up instead of buying consumer goods. Meanwhile, New York’s manufacturing index stemmed the dollar’s losses as it printed a reading of 9.5, which is a lot bigger than the expected 5.2 index number.
Uncle Sam will be in for another interesting day today with the U.S. CPI numbers due at 12:30 pm GMT, followed by the industrial production numbers and NAHB housing data at around 1:00 - 2:00 pm GMT. The numbers aren’t expected to significantly exceed their previous figures, but make sure you take your cues from yesterday’s retail sales and watch out for any surprises!
With Big Ben’s speech just around the corner, it seems that the dollar bulls are starting to reduce their positions. The dollar stumbled against the euro, franc, yen, and Aussie in yesterday’s trading matches. What could be in store for us today?
Headline CPI came in slightly higher than anticipated, printing at 0.5%, after it was seen to come in at 0.3%. Meanwhile, the core version came in as projected 0.2%, indicating that rising inflation isn’t a big deal for Uncle Sam right now.
The major surprise yesterday though was the results of the TIC long-term purchases report. Instead of printing a figure of 14.3 billion USD, the report came in at -27.2 billion USD. This marked the fourth consecutive month of negative figures, which means that more and more foreigners have been purchasing dollar-denominated financial assets. Could this be a result of the market expecting tapering from the Fed?
In other news, industrial production rose by 0.3%, as opposed to the 0.2% expected figure. However, this wasn’t enough to boost the dollar and keep it from sliding down the charts yesterday.
We could be in for a wild ride today, as Ben Bernanke will be making his semi-annual monetary policy update at 2:00 pm GMT. After last week’s surprisingly dovish FOMC meeting minutes, who knows what Bernanke might say today!
Also make sure to tune in at 12:30 pm GMT, as housing data will be made available in the form of building permits and housing starts. The two reports are projected to post annualized paces of 1 million and 960,000, respectively. Higher than anticipated numbers would indicate a strengthening housing market, which could boost sentiment towards the dollar.
Oh my, what a frenzy! Dollar pairs were all over the place during Ben Bernanke’s speech, as EUR/USD popped up to a high of 1.3177 before sinking down to a low of 1.3083 a few minutes later. At the end of the day though, most major currency pairs finished close to where they started.
According to Bernanke’s testimony, the Fed is still on track to reduce bond purchases by the end of the year. However, he also cautioned that policymakers also have the option to increase bond purchases if inflation and employment would fall behind in the coming months. Most market participants were pretty much confused by these statements, as the dollar was unable to find a clear direction right after Big Ben’s speech and press conference.
As for economic data, building permits and housing starts both missed expectations. Building permits were up by 0.91 million, which was lower than the estimated 1.00 million figure and the previous 0.99 million reading. Housing starts showed a 0.84 million figure, lower than the expected 0.96 million reading.
Initial jobless claims and and the Philly Fed manufacturing index are on tap for today. The jobless claims report could show a 344K reading, slightly lower than the previous week’s 360K in first-time claimants. The Philly Fed index is slated to drop from 12.5 to 8.5, reflecting weaker manufacturing activity in the area. Keep an eye out for the actual releases starting 1:30 pm GMT, as the dollar could react strongly to fundamentals!
The dollar bulls gained ground at winning the tug-o-pips yesterday as positive U.S. data boosted the Greenback. EUR/USD and GBP/USD barely moved from their open prices, but USD/JPY and USD/CHF both showed decent gains.
Big Ben Bernanke didn’t set off any fireworks in his second speech yesterday as he only repeated his and the FOMC’s sentiment on asset purchases. Basically, the central bank is willing to taper its bond buying, but is in no hurry to do it aggressively.
Good economic data also helped boost the dollar across the charts. Initial jobless claims dropped from 358K to a two-month low of 334K, supporting the Fed’s claims that the jobs market is slowly gaining traction. The Philly Fed manufacturing index also spread good vibes when it came in at 19.8 in July, which is more than twice the expected 8.5 reading and is a heck of a lot stronger than the 12.5 index figure that we saw in June.
We won’t be seeing any economic data from the U.S. today, so keep your eyes peeled on the G20 meetings scheduled today as well as any reports from other major economies that might influence the price action of the Greenback.
Good luck!
OUCH! The dollar got kicked to the curbed in Friday’s trading. Without any economic data on tap, it finished lower against ALL of its counterparts. What the heck happened?
It would seem that the lack of economic reports from the U.S. left the dollar vulnerable to market sentiment. Unfortunately for the currency, news about the PBOC removing its lower limit on lending rates spurred a bit of risk appetite. Although the effect didn’t last long, it was enough to push EUR/USD higher and finish the day 31 pips higher at 1.3143 while AUD/USD was up 28 pips at .9190.
I wonder if the dollar will get any support from the existing home sales report for June later at 2:00 pm GMT. The forecast is at 5.27 million. Positive data could boost the dollar as this would support the Fed’s plans of tapering later this year. Watch out for it!