Daily Market Outlook by Kate Curtis from Trader's Way

Commercial Content Analysts
605

USD

The US dollar was off to a weak start when risk-taking took place but soon regained the top spot when the market mood turned sour. There have been no major reports out of the US then, as the IMF’s decision to lower global growth forecasts was one of the biggest reasons for the return in risk aversion. For today, US CPI and building permits data are up for release.

EUR

The euro managed to stay somewhat resilient in recent trading sessions, even taking advantage of the weakness in commodity currencies. Data from the region was mostly stronger than expected, as the current account balance beat expectations while the euro zone final CPI reading was unchanged. The German ZEW economic sentiment index fell from 18.1 to 10.2, higher than the estimated 8.2 figure. Only the German PPI is due from the euro zone today.

GBP

The pound was in for a carnage when BOE Governor Carney clarified that they’re not ready to hike interest rates anytime soon. He explained that the slowdown in China is likely to weigh on global growth and inflation, adding that they have no timetable for tightening yet. UK inflation reports actually beat expectations, with the headline figure rising from 0.1% to 0.2% and the core figure climbing from 1.2% to 1.4%. UK jobs data is due today and a 4.1K increase in claimants is eyed while the average earnings index could slide from 2.4% to 2.1%.

CHF

The franc held its ground even as Swiss PPI came in weaker than expected with a 0.4% decline versus the projected 0.2% increase. The ZEW economic expectations index is due today and an improvement from the previous 16.6 figure might be positive for the franc.

JPY

The yen took advantage of the run in risk aversion at the start of the US trading session, as BOE Governor Carney’s speech and the IMF downgrades hit the airwaves. There were no reports out of Japan yesterday and none are due today, which suggests that risk sentiment could continue to drive price action.

Commodity Currencies (AUD, NZD, CAD)

Data from China came in slightly weaker than expected but comdolls managed to stay afloat during the earlier trading sessions, only to give up ground when US traders returned to their desks. The IMF’s downgrades on this year’s and next year’s growth forecasts weighed heavily on the commodity currencies since the agency highlighted the potential repercussions on exports. Also, New Zealand’s dairy auction yielded a 1.4% drop in prices while their quarterly CPI showed a larger than expected 0.5% drop. In Australia, Westpac consumer sentiment fell by 3.5%. The BOC statement is due next and a 0.25% rate cut is eyed.

By Kate Curtis from Trader’s Way

606

USD

The US dollar had a pretty volatile day, as it benefitted from risk aversion in the earlier trading sessions but gave up most of its gains later on. Data from the US was mostly weaker than expected, with both headline and core CPI missing forecasts. For today, only the natural gas storage and crude oil inventories numbers are due, although these might have a stronger impact on comdolls.

EUR

The euro had a mixed performance as it gave up ground to the yen and dollar but advanced against the commodity currencies. German PPI was weaker than expected with a 0.5% decline versus the projected 0.3% drop. The ECB statement is scheduled today and no easing announcements are expected, although traders are likely to pay close attention to any changes in rhetoric.

GBP

The pound was off to a weak start but soon recovered when the UK jobs figures came in mostly stronger than expected. Analysts expected claimants to rise by 4.1K but saw an increase of 4.3K in hiring instead. The jobless rate edged down from 5.2% to 5.1% but the average earnings index reflected a lack of wage growth as it fell from 2.4% to 2.0%. There are no major reports due from the UK today.

CHF

The franc gave up ground when the ZEW economic sentiment index fell from 16.6 to -3.0, indicating pessimism. There are no reports due from the Swiss economy today, which suggests that the franc could take its cue from the ECB announcement and euro price action.

JPY

The Japanese yen rallied in the earlier trading sessions when the risk-off environment was still in play. Talks of further BOJ easing also lifted the safe-haven currency but it had to return its winnings when sentiment improved later on. The Japanese all industries activity index is due today and a 0.7% decline is expected.

Commodity Currencies (AUD, NZD, CAD)

The comdolls made a strong recovery recently, especially after the BOC decided to keep rates unchanged at 0.50%. According to the official statement, risks to inflation remain balanced and the central bank is counting on the government’s fiscal stimulus to help keep the economy afloat even without an additional rate cut. In Australia, inflation expectations fell from 4.0% to 3.6%. Crude oil inventories and natural gas storage numbers are due next.

By Kate Curtis from Trader’s Way

607

USD

The US dollar was forced to return its wins before the end of the trading session when risk appetite picked up. Data from the US was mixed, as the Philly Fed index improved from -5.9 to -3.5 while initial jobless claims showed a larger than expected rise of 293K versus the projected 279K figure. Only the US flash manufacturing PMI and existing home sales are up for release today and both reports are slated to show improvements.

EUR

The euro suffered a sharp selloff during the press conference after the ECB statement, as Governor Draghi emphasized that they’re willing to act if necessary. He admitted that the economy condition has worsened since December and that they don’t have a shortage of monetary policy easing measures to use in March. Still, the shared currency regained ground when risk-on flows emerged at the end of the day. Euro zone PMI readings and another testimony by Draghi are lined up today.

GBP

The pound also gave up ground then quickly reversed its drop, as the currency took its cue from market sentiment. There have been no major reports out of the UK yesterday while today has the retail sales and public sector net borrowing report on tap. A 0.1% decline in consumer spending is eyed while the public deficit might narrow to 10.1 billion GBP from 13.6 billion GBP.

CHF

The franc initially gave up ground to the dollar but recouped its losses later on, even though there were no major releases from the Swiss economy. There are still no reports due from Switzerland today, although the euro zone PMIs might serve as catalysts for franc price action.

JPY

The yen was unable to hold on to its recent wins when risk appetite returned to the markets. Japan’s all industries activity index showed a 1.0% decline, worse than the projected 0.7% drop, and their flash manufacturing PMI is due today. An improvement from 52.6 to 52.8 is eyed.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to rake in a lot of gains when risk-on flows emerged and oil prices rebounded. Crude oil inventories rose by 4 million barrels versus the projected 3.3 million gain, but WTI crude oil managed to bounce to the $30/barrel level. Canada’s CPI and retail sales reports are up for release today, with a 0.4% drop in the headline CPI expected.

By Kate Curtis from Trader’s Way

608

USD

The US dollar gave up more of its recent gains on Friday, although it regained ground to the euro, yen, and franc. Data from the US economy was stronger than expected, as the flash manufacturing PMI rose from 51.2 to 52.7 versus the projected 51.5 figure. Existing home sales also rose from 4.76M to 5.46M. For today, there are no reports out of the US economy so risk sentiment might push dollar pairs around.

EUR

The euro resumed its slide against its peers, particularly the commodity currencies, when risk appetite kicked in. Data from the euro zone was mostly weaker than expected, with the German and French flash manufacturing PMI coming in weaker than expected. ECB Governor Draghi is set to give a testimony today and he might reiterate their easing bias while the German Ifo business climate index is slated to tick down from 108.7 to 108.5.

GBP

The pound was on strong footing last Friday that not even the downbeat retail sales report from the UK was enough to stop its rallies. Headline consumer spending fell by 1.0% but the public sector deficit narrowed to 6.9 billion GBP, giving the pound an additional boost. There are no major reports due from the UK today.

CHF

The franc followed the euro’s footsteps and gave up ground to most of its rivals when risk appetite picked up. There were no reports out of the Swiss economy then and none are due today, leaving risk sentiment in play.

JPY

The yen gave up most of its gains for the week on Friday, with traders positioning ahead of potential BOJ easing this week. Japan’s flash manufacturing PMI fell from 52.6 to 52.4 instead of improving to the estimated 52.8 figure but the trade surplus widened from 0.04T JPY to 0.06T JPY.

Commodity Currencies (AUD, NZD, CAD)

The comdolls took advantage of the pickup in commodity prices and risk appetite last Friday, advancing against their forex counterparts throughout the day. Data from Canada was mixed, with retail sales beating expectations and CPI falling short. In Australia, the NAB business confidence index fell from 5 to 3, indicating lower optimism.

By Kate Curtis from Trader’s Way

610

USD

The US dollar regained ground in recent sessions when risk-off flows dominated price action. There have been no reports out of the US yesterday but the slump in oil prices was enough to send traders scurrying back to the safe-havens. The US flash services PMI, CB consumer confidence index, and Richmond manufacturing index are all due today.

EUR

The euro resumed its rallies, taking advantage of some of the risk-off flows even with downbeat data. Germany’s Ifo business climate index fell from 108.6 to 107.3, worse than the estimated drop to 108.5. There are no major reports lined up from the euro zone today.

GBP

The pound retreated from its climb when the UK CBI industrial order expectations came in weaker than expected. The reading fell from -7 to -15, worse than the projected drop to -10. BOE Governor Carney is set to testify today and another round of cautious comments could weigh on the pound.

CHF

The franc was also able to profit from some of the risk-off flows in recent trading sessions, although that could change on today’s release of the Swiss trade balance. Analysts are expecting to see a wider surplus of 3.33 billion CHF compared to the previous 3.14 billion CHF figure, but underlying import and export components might be more crucial in terms of determining the franc’s reaction.

JPY

The yen gave up some ground on speculations of further BOJ easing later this week but was able to recoup its losses when risk aversion returned. There have been no major reports out of Japan, leaving traders to react to market sentiment or set their positions ahead of the BOJ statement.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned their recent wins when commodity prices tumbled, taking WTI crude oil below $30/barrel again. In Australia, the NAB business confidence index fell from 5 to 3 to indicate weaker optimism. In New Zealand, credit card spending picked up by 7.4%. No other reports are due from the comdoll economies today, keeping risk sentiment in play.

By Kate Curtis from Trader’s Way

611

USD

The US dollar gave up ground when risk appetite picked up during the latter trading sessions once more, as oil prices made a strong rebound. Data from the US economy came in mixed, with the CB consumer confidence improving and beating expectations. However, the flash services PMI and Richmond manufacturing index showed declines. For today, the FOMC statement will be made and no monetary policy changes are expected. Still, traders could pay attention to any change in rhetoric and clues for a March hike.

EUR

The euro was barely able to take advantage of yen and dollar weakness, as the prospect of further ECB easing weighed on the shared currency. The German GfK consumer climate index is up for release today and a drop from 9.4 to 9.4 is eyed.

GBP

The pound suffered a sharp selloff when BOE Governor Carney reiterated his downbeat bias, citing that the central bank isn’t ready to hike anytime soon and that negative rates might even be a possibility. Only the Nationwide HPI and BBA mortgage approvals figures are up for release today.

CHF

The franc experienced a sudden drop in recent trading, partly spurred by the weaker than expected Swiss trade balance. Traders speculated that the SNB might be slowly intervening in the forex markets to prepare for any additional ECB easing in March. The Swiss UBS consumption indicator is up for release today.

JPY

The yen was also in a weak spot when risk appetite returned to the financial markets towards the end of the European session. There have been no reports out of Japan recently and none are due today, leaving traders to price in their expectations for the BOJ statement.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to find support from the rebound in oil prices, even though data simply came in line with expectations. Australia’s quarterly CPI landed at 0.4%, down from the previous 0.5% figure but higher than the projected 0.3% reading. Crude oil inventories data is due today, ahead of the FOMC and RBNZ interest rate statement.

By Kate Curtis from Trader’s Way

612

USD

The US dollar had a volatile time during the FOMC statement, as the currency initially rallied but instantly gave back its gains. According to the Fed, they are monitoring the global financial and economic developments closely, removing the reference on balanced risks to their outlook. FOMC officials also reiterated that they would continue to tighten at a gradual pace. US durable goods orders and initial jobless claims are due today.

EUR

The euro was able to stay afloat in recent trading sessions, as the German GfK consumer climate index came in slightly better than expected. The reading held steady at 9.4 instead of dropping to 9.3. For today, German preliminary CPI and the Spanish unemployment rate data are due, with the former expected to show a 1% drop and the latter likely to print a drop from 21.2% to 21.1%.

GBP

The pound had a mixed performance as it took advantage of dollar weakness but caved against its other forex rivals. Data from the UK came in weaker than expected, as the Nationwide HPI came in at 0.3% versus 0.6% while BBA mortgage approvals fell to 44K. The UK preliminary GDP reading is due today and a 0.5% growth figure is eyed.

CHF

The franc has been depreciating against its peers, as the SNB is rumored to be intervening in the forex market ahead of potential ECB easing in March. Data from Switzerland showed an improvement, as the UBS consumption indicator rose from a downgraded 1.55 figure to 1.62. There are no reports due from the Swiss economy today.

JPY

The yen weakened against most of its counterparts ahead of Friday’s BOJ statement, as the retail sales report missed expectations. Consumer spending fell by 1.1% instead of showing the projected 0.1% uptick. Tokyo core CPI, national core CPI, and household spending data are due next.

Commodity Currencies (AUD, NZD, CAD)

Oil and the Loonie managed to stay afloat despite the surge in US crude oil inventories, as other members of the OPEC seemed willing to attend an emergency meeting. The RBNZ kept rates unchanged at 2.50% as expected but kept the door open for further easing. In Australia, import prices slid 0.3% versus the projected 0.8% drop.

By Kate Curtis from Trader’s Way

613

USD

The US dollar gave up more ground to its peers when US data came in mostly weaker than expected. Headline durable goods orders fell 4.4% while core durable goods orders dropped 1.2%. Pending home sales rose 0.1% only instead of showing the projected 1.0% gain. Advanced GDP data is due today and a 0.8% growth figure is eyed, although weaker than expected data could mean more losses for the dollar.

EUR

The euro was able to take advantage of dollar and yen weakness yesterday, as euro zone data came in slightly better than expected. The German preliminary CPI fell 0.8% as expected while the Spanish unemployment rate improved from 21.2% to 20.9%. Euro zone CPI estimates are due today, along with flash GDP readings from Spain and France.

GBP

The pound also gained ground when the UK preliminary GDP reading came in line with expectations of 0.5% growth. CBI realized sales data was weaker than expected, as the index fell from 19 to 16, worse than the estimated fall to 18. There are no major reports due from the UK economy today.

CHF

The franc erased some of its previous losses when risk appetite improved, even though there were no major reports out of the Swiss economy. There are still no reports due from Switzerland today but the euro zone’s CPI estimates could revive SNB intervention speculations.

JPY

The yen lost ground on account of risk appetite and weak Japanese data. Household spending slumped by 4.4% year-over-year in December while the Tokyo core CPI printed a 0.1% decline. The national core CPI came in line with expectations of a 0.1% uptick while the unemployment rate held steady at 3.3%. Preliminary industrial production was also weaker than expected with a 1.4% slump. The BOJ decision is scheduled today, with some analysts expecting additional stimulus.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to squeeze out more gains on rumors of an OPEC emergency meeting for production cuts. Russia’s oil minister said that Saudi had a proposal for countries to cut production by 5% but an OPEC official dismissed these rumors. In Australia, PPI data came in weaker than expected, hinting of weaker price pressures down the line. Canadian GDP and underlying inflation figures are up for release next.

By Kate Curtis from Trader’s Way

614

USD

The US dollar had a mixed performance as it advanced to the yen, euro, and pound but gave up ground to the commodity currencies. The US advanced GDP reading was slightly weaker than expected at 0.7% versus the projected 0.8% growth figure and the previous 2.0% expansion. However, the Chicago PMI came in stronger than expected and indicated a return to industry expansion. US personal income and spending data, along with the core PCE price index, are up for release today. The ISM manufacturing PMI is also lined up and a rise from 48.2 to 48.6 is expected.

EUR

The euro returned some of its recent forex wins, despite mixed data from the euro zone. German retail sales and Spanish flash CPI came in weaker than expected but the region’s core CPI estimate improved to 1.0%. Final manufacturing PMI readings from its largest economies are due today, followed by a testimony from ECB head Draghi.

GBP

The pound suffered a sharp selloff before the markets closed on Friday, as traders probably priced in expectations of more dovish remarks in this week’s BOE events. The Inflation Report, BOE statement, and MPC minutes are due on Thursday. UK manufacturing PMI and net lending to individuals figures are due today, along with mortgage approvals data.

CHF

The franc was also in a weak spot towards the end of last week’s trading sessions, as traders lightened up on their positions. Swiss data was actually better than expected, as the KOF economic barometer rose from 96.8 to 100.3. The Swiss manufacturing PMI is due today and a drop from 52.1 to 51.0 is eyed.

JPY

The yen lost a lot of ground on Friday when the BOJ decided to implement negative deposit rates. Earlier today, Japan’s manufacturing PMI reading was downgraded from 52.4 to 52.3 for January.

Commodity Currencies (AUD, NZD, CAD)

The comdolls took advantage of the yen selloff on Friday while also gaining ground on rising oil prices. Rumors of oil deals between Russia and OPEC nations propped prices up but these were dismissed by some Saudi officials. Earlier today, the Chinese official manufacturing PMI indicated a drop from 49.7 to 49.4 while the Caixin version showed an improvement from 48.2 to 48.4.

By Kate Curtis from Trader’s Way

615

USD

The US dollar was weighed down by weak data and dovish Fed rhetoric. US personal spending was flat in December even while personal income rose by 0.3%. The core PCE price index also showed a flat reading instead of the estimated 0.1% increase. Later on, the ISM manufacturing PMI showed no change at 48.2 instead of rising to the projected 48.6 figure, with the employment component indicating a decline. FOMC member Fischer noted that inflation could stay low for somewhat longer and his fellow FOMC member George is set to give a testimony today.

EUR

The euro managed to take advantage of dollar weakness but lagged behind the pound and the commodity currencies. Revised PMI readings from euro zone’s top economies came in mostly in line with expectations. German and Spanish unemployment change numbers are up for release today and strong readings could give the euro another boost.

GBP

The pound staged a very strong rally after seeing stronger than expected manufacturing PMI data. The report showed a rise from 52.1 to 52.9 instead of the projected drop to 51.8, reflecting stronger industry expansion. Construction PMI is due today and a dip from 57.8 to 57.6 is eyed.

CHF

The franc managed to recoup some of its recent losses to its peers as there were no major reports out of the euro zone and the Swiss economy. Their manufacturing PMI fell from 52.1 to 50.0 to show a slower pace of industry growth. Swiss retail sales is due today and a 1.3% decline is expected.

JPY

The yen struggled to regain some ground in recent sessions, as traders are still weighing the impact of negative deposit rates. There are no major reports due from the Japanese economy today, keeping risk sentiment in play.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to advance in recent trading sessions, as risk appetite lifted the higher-yielding currencies. The RBA statement is scheduled today and no major changes are expected, although the central bank might acknowledge the risks from China and caution that the Aussie is still overvalued. New Zealand’s quarterly jobs report is due next and a 0.8% increase is expected but the unemployment rate could rise from 6.0% to 6.1%. The GDT auction is also due in the late US session.

By Kate Curtis from Trader’s Way

616

USD

The US dollar had a mixed performance in recent trading sessions, as it advanced to the commodity currencies but retreated to the yen and European currencies. There were no major reports out of the US then, leaving the Greenback to function as a counter currency. For today the ADP non-farm employment change is due, along with the ISM non-manufacturing PMI.

EUR

The euro was able to advance against the dollar but weakened to the yen, even as employment data from Germany and Spain came in stronger than expected. Spain’s unemployment increased less than expected while Germany reported a drop in joblessness of 20K. Final services PMI readings are due from the euro zone’s top economies today.

GBP

The pound shrugged off weaker than expected construction PMI as it rallied against its forex counterparts. The report showed a drop from 57.8 to 55.0, worse than the projected fall to 57.6. For today, the services PMI is due and a dip from 55.5 to 55.4 is eyed.

CHF

The franc regained a bit of ground when SNB Thomas Jordan gave his testimony, as the central bank head refrained from jawboning the currency. Data from Switzerland was still weaker than expected, with retail sales down by an annualized 1.6% versus the estimated 1.3% decline. There are no reports due from the Swiss economy today.

JPY

The yen got back on its feet when risk aversion returned during the US trading session. There were no major reports out of Japan yesterday while today had the BOJ meeting minutes released. BOJ Kuroda also has a testimony lined up and this might spur additional volatility among yen pairs.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up their recent wins when oil supply concerns dominated the headlines again. The API report showed an increase of 3.387 million barrels of crude oil while other energy supplies also piled up. In New Zealand, the dairy auction showed a 7.4% slump in dairy prices while the employment report printed strong headline figures. Underlying data, however, revealed weaker labor force participation. In Australia, building approvals beat expectations but the trade balance came in short. Crude oil inventories from the EIA are due next.

By Kate Curtis from Trader’s Way

617

USD

The US dollar suffered a sharp selloff during the New York session as data came in mixed and Fed official Dudley said that the currency’s appreciation might be damaging to the economy. The ADP non-farm employment change report indicated a larger than expected gain of 205K versus the projected 193K gain while the previous reading was upgraded from 257K to 267K. However, the ISM non-manufacturing PMI fell from 55.3 to 53.5, worse than the estimated dip to 55.1, and most of the components reflected declines.

EUR

The euro was able to take advantage of dollar weakness but was still lower against its higher-yielding counterparts. Some of the euro zone services PMI readings from top economies saw downgrades and the region’s retail sales figure came in short of expectations with a meager 0.3% gain. There are no major reports due from the region today but ECB head Draghi has a testimony lined up.

GBP

The pound could be in for a lot of volatility with the BOE statement coming up. Along with this is the release of the BOE Inflation Report, which contains their revised forecasts for growth and inflation, and the MPC minutes which would show the policymakers’ biases. Dovish remarks echoing Carney’s previous downbeat statements could mean more losses for the UK currency.

CHF

The franc advanced to the dollar but consolidated against most of its other currency peers.There were no reports out of Switzerland then and today has the SECO consumer climate index lined up. The reading is expected to improve from -18 to -15, indicating a lower level of pessimism.

JPY

The yen gave up some of its recent gains when risk appetite picked up and traders moved out of their long dollar holdings onto yen positions. There were no reports out of Japan then and there were no surprises from Kuroda’s testimony. There are still no reports due from Japan today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls enjoyed a strong rally in recent sessions when oil prices bounced on speculations of an OPEC meeting. Reports showed that six nations are urging for a special meeting this month to discuss production cuts, which might then keep prices supported. US crude oil inventories rose by 7.8 million barrels versus the projected 3.7 million gain. Earlier today, Australia’s NAB business climate index rose from 1 to 4. No other reports are due from the comdoll economies today.

By Kate Curtis from Trader’s Way

618

USD

The US dollar suffered another sharp selloff in yesterday’s New York session when data from the economy came in below expectations. Initial jobless claims rose 285K versus the projected 279K increase while factory orders slumped 2.9%. Up ahead, the NFP is slated to show a 189K gain in hiring, weaker compared to the previous 292K increase but still likely enough to keep the jobless rate at 5.0%.

EUR

The euro took advantage of dollar weakness and managed to post some gains against some of its peers as well. Euro zone growth forecasts were actually revised lower but it looks like this was already priced in. German factory orders data is due today and a 0.3% decline is set to follow the previous 1.5% gain.

GBP

The pound was one of the weakest performers when the BOE Super Thursday was more dovish than expected. Policymakers voted unanimously to keep rates on hold, with McCafferty rejoining the doves and backing down from his previous calls to hike. The BOE Inflation Report also featured downgrades on growth and inflation. There are no reports due from the UK today.

CHF

The franc regained ground when the Swiss SECO consumer climate index improved from -18 to -14, slightly higher than the estimated climb to -15. The Swiss foreign currency reserves report is due today and a large increase could lead to speculations of currency intervention, which might then drive the franc much lower.

JPY

The yen took advantage of the risk-off flows yesterday, especially after the BOE reports came out. There were no reports lined up from Japan then while today has the leading indicators due.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to carry on with their rallies, as oil prices posted more gains. Rumors that Turkey is gearing up to invade Syria could put additional downside pressure on supply, which could keep prices afloat. Australian retail sales came in flat instead of showing the estimated 0.5% gain for December. Canada’s jobs report is due next and a 5.2K gain in hiring is eyed.

By Kate Curtis from Trader’s Way

619

USD

The US dollar advanced against its forex rivals when the underlying data of the NFP release showed green shoots. The economy added only 151K jobs in January versus the projected 189K gain while the December reading was downgraded from 292K to 262K. Still, the unemployment rate fell to its nine-year low of 4.9% while the participation rate improved. Average earnings rose 0.5% versus the projected 0.3% forecast. No reports are due from the US today.

EUR

The euro gave up ground to the dollar and yen but was still strong against its other rivals, even though German factory orders missed expectations. The report indicated a 0.7% drop instead of the projected 0.3% dip. German industrial production and euro zone Sentix investor confidence numbers are due today.

GBP

The pound managed to limit its losses to the dollar but weakened to the commodity currencies. There were no reports out of the UK then and there are no reports due today.

CHF

The franc managed to stay steady against the dollar while advancing to the euro on Friday. Swiss foreign currency reserves actually fell to 575 billion CHF, indicating that the SNB isn’t intervening in the financial markets. There are no reports due from the Swiss economy today.

JPY

The yen was able to score gains against its higher-yielding counterparts but was no match to dollar strength. Japanese leading indicators fell from 103.5% to 102% to indicate potential weakness in the economy.

Commodity Currencies (AUD, NZD, CAD)

The Aussie lost a lot of ground to the dollar as retail sales fell flat instead of showing the estimated 0.3% gain while the RBA statement indicated scope for further easing. Chinese banks are on holiday today which suggests some consolidation for AUD and NZD pairs. In Canada, the jobs data missed expectations and showed a 5.7K decline in hiring versus the projected 5.2K increase.

By Kate Curtis from Trader’s Way

620

USD

The US dollar regained ground to the higher-yielders, except for the euro, franc, and yen. Risk aversion allowed the safe-haven currency to get back on its feet even though there were no major reports released. JOLTS job openings and wholesale inventories data are due today.

EUR

The euro advanced to the dollar and comdolls but lost ground to the yen and franc. Euro zone Sentix investor confidence slipped from 9.6 to 6.0, worse than the projected drop to 7.2. German industrial production and trade balance are due today, with weak data likely to weigh on the shared currency’s gains.

GBP

The pound was one of the weakest performers of the bunch as there were no reports to keep it supported. UK BRC retail sales monitor data showed a 2.6% rebound but was still unable to give the currency a boost. UK trade balance and a speech by MPC member Cunliffe are lined up today.

CHF

The franc resumed its rally from last week, as the SNB foreign currency reserves showed no evidence of intervention. Swiss unemployment rate is due today and a rise from 3.4% to 3.5% is eyed, likely to push the franc a bit lower.

JPY

The yen was one of the biggest winners, as it advanced against its currency rivals thanks to risk-off moves. Data from Japan was actually weaker than expected but traders appeared to prefer the Japanese currency against its other safe-haven peer, the US dollar. Preliminary machine tool orders data is due today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls chalked up a lot of losses at the start of the week, even as the absence of Chinese traders kept markets in the green during the Asian session. The meeting between Venezuela and small oil-producing nations failed to bear fruit, weighing on oil prices again. In Australia, the NAB business confidence index held steady at 2, not showing any improvement.

By Kate Curtis from Trader’s Way

621

USD

The US dollar was in a weaker spot yesterday even as it put up a fight against the comdolls. Data from the US economy came in mixed, with JOLTS job openings showing a gain and the NFIP small business index declining. Fed head Yellen’s speech might be a strong catalyst for directional plays today as traders are waiting to hear more clues on whether a March hike is possible or not.

EUR

The euro chalked up strong gains against its peers and even rebounded against the Japanese yen. Data from the euro zone was actually weaker than expected as the German industrial production report indicated a 1.2% decline instead of the projected 0.2% uptick. French and Italian industrial production numbers are due today.

GBP

The pound managed to hold steady against the dollar and yen while racking up some gains against the comdolls. Today has the manufacturing and industrial production reports on tap and weak readings might be in the cards given how the previous reports turned out. UK manufacturing production is expected to have stayed flat in December.

CHF

The franc carried on with its advance against the dollar and euro, as the Swiss jobless rate held steady at 3.4% instead of rising to the estimated 3.5% figure. There are no reports up for release from the Swiss economy today.

JPY

The Japanese yen lost a bit of ground when risk appetite improved early yesterday but managed to get back on its feet later on. Data from Japan has been weaker than expected, with producer prices down 3.1% versus the projected 2.8% fall.

Commodity Currencies (AUD, NZD, CAD)

The Loonie ignored another buildup in oil stockpiles as it tried to hold on to its current levels. US crude oil inventories data is due today and an increase of 3.1 million barrels is eyed, likely to weigh on prices again. In Australia, the Westpac consumer sentiment report showed a 4.2% gain while HIA new home sales jumped 6.0%.

By Kate Curtis from Trader’s Way

622

USD

The US dollar had a volatile day as it initially reacted positively to Yellen’s remarks but eventually returned its recent gains. According to Yellen, the equity market selloff might have a negative impact on overall growth and that they’d continue to watch the markets closely to see if any adjustments to their tightening path should be made. She also mentioned that she’s unsure if the Fed can legally implement negative deposit rates. Initial jobless claims and another testimony from Yellen are on today’s docket.

EUR

The euro was able to advance against most of its rivals except for the Japanese yen. Data from the euro zone was still mostly weaker than expected, as France and Italy printed negative industrial production readings. There are no major reports due from the euro zone today.

GBP

The pound managed to make a quick bounce against most of its counterparts even though data from the UK missed expectations. Manufacturing production fell 0.2% instead of staying flat while industrial production sank 1.1% instead of falling by only 0.1%. There are no major reports due from the UK today.

CHF

The franc continued to advance against most of its counterparts as it appears to be supported by risk-off flows. There were no reports out of Switzerland yesterday while today has the Swiss CPI on tap. A 0.3% decline in price levels is eyed and weak data might revive intervention speculations.

JPY

The yen took advantage of the risk-off market mood to chalk up more gains against its rivals. There were no reports out of Japan then and Japanese banks are closed for the holidays today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls chalked up some gains against the dollar but were no match to yen strength. US crude oil inventories showed a decline in stockpiles but did little to support prices as news of energy companies suffering losses dominated the headlines. There are no major reports due from the comdoll economies today.

By Kate Curtis from Trader’s Way

623

USD

The US dollar was unable to take a lot of advantage of the safe-haven flows yesterday as Fed Chairperson Yellen warned that central bank officials are watching exchange rates closely before making any monetary policy adjustments. This echoes FOMC member Dudley’s remarks indicating that dollar strength might actually be harmful for the US economy. For today, US retail sales reports are due and a 0.1% uptick in the headline figure is eyed while the core version of the report could show a flat reading.

EUR

The euro managed to hold on to some of its wins despite the slump in the European stock market, fueled by concerns about the banking sector and a possible Grexit. Up ahead, preliminary GDP readings from the euro zone and its top economies could serve as catalysts for strong euro moves.

GBP

The pound was still in a weak spot due to downbeat manufacturing production data released the previous day and the looming possibility of a Brexit. Only the construction output report is due from the UK today and another downbeat reading could spur more losses for the British currency.

CHF

The franc was able to chalk up some gains against the dollar but lost ground to the euro as currency intervention talk started to hit the airwaves. Although SNB officials have already maintained that the franc is overvalued, they’ve stopped short of actual intervention based on the latest foreign currency reserves data. Swiss CPI was weaker than expected with a 0.4% decline versus the projected 0.3% drop. There are no reports due from the Swiss economy today.

JPY

The yen surged against its forex rivals thanks to yet another round of risk aversion but quickly spiked when rumors of central bank intervention were spread. A Japanese official mentioned in an interview that they are watching FX movements closely and with urgency. There are no reports due from the Japanese economy today, which suggests that risk sentiment could push yen pairs around again.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were mostly unchanged to the dollar but ended weaker against the yen, as risk-off flows dominated. There were no major releases out of the comdoll economies, although news of an OPEC compromise appears to be lifting oil prices. OPEC leaders seem willing to cut production only if their non-OPEC counterparts also agree to do so, but Iran has previously stressed that they plan to increase production.

By Kate Curtis from Trader’s Way

624

USD

The US dollar was able to rebound on Friday, thanks to upbeat retail sales figures and profit-taking off short positions ahead of the weekend. Headline retail sales rose 0.2% instead of just 0.1% while the core figure indicated a 0.1% uptick versus the projected flat reading. Import prices fell 1.1% versus the projected 1.4% slump while the UoM consumer sentiment index slipped from 92.0 to 90.7. US banks are closed for President’s Day today.

EUR

The euro returned some of its recent wins to its counterparts last Friday even as German and euro zone GDP readings came in line with expectations of 0.3% growth. Euro zone industrial production fell 1.0% instead of rising by the projected 0.3% figure. Euro zone trade balance is due today and a smaller surplus of 22.4 billion EUR is eyed compared to the previous 22.7 billion EUR surplus.

GBP

The pound managed to hold on to some of its recent wins despite weaker than expected UK quarterly construction output. The report showed a 1.5% increase versus the projected 2.0% gain but still chalked up a recovery from the previous 1.1% drop. Earlier today, UK Rightmove HPI showed a 2.9% gain in prices.

CHF

The franc got back on its feet at the end of the week on the lack of intervention talk from SNB officials. There are no reports due from the Swiss economy today so the franc could still advance if risk aversion stays in play.

JPY

The yen had another losing day as risk appetite improved and intervention fears weighed on the Japanese currency. Over the weekend, the preliminary GDP reading from Japan showed a 0.4% contraction versus the projected 0.3% reduction in growth. BOJ Governor Kuroda has a speech in parliament today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were able to advance against their lower-yielding peers thanks to stronger talks of an OPEC compromise. Earlier today, Chinese trade balance came in stronger than expected at a 406 billion CNY surplus versus the projected 389 billion CNY figure. New Zealand quarterly retail sales are due in the next Asian session and a 1.4% gain in the core figure is eyed.

By Kate Curtis from Trader’s Way

625

USD

The Greenback was mostly a counter currency in recent trading sessions, as US traders were off on a President’s Day holiday. Only the Empire State manufacturing index is up for release today and a rise from -19.4 to -10.5 is expected.

EUR

The euro suffered a sharp drop when ECB head Draghi reiterated the possibility of additional ECB easing in March. He said that policymakers would study the impact of falling commodity prices on domestic inflation and the risks from the global financial turmoil. ZEW economic sentiment figures are up for release from Germany and the rest of euro zone today.

GBP

The pound was also sold off sharply after BOE member McCafferty admitted that negative rates could be a policy option for the central bank. Recall that McCafferty had previously been voting for rate hikes so his dovish tone represents a significant shift. UK CPI numbers are due today, with the headline figure expected to rise from 0.2% to 0.3% and the core figure expected to dip from 1.4% to 1.3%.

CHF

The franc gave up some of its recent wins on talks of additional ECB easing, as traders are generally wary of SNB intervention in case that happens. There were no reports out of Switzerland yesterday and none are due today.

JPY

The yen was still in a weak spot as risk appetite resumed in the markets. Data from Japan was also mostly weaker than expected, with the GDP showing a 0.4% contraction for Q4 and the industrial production figure downgraded to show a sharper 1.4% decline. Tertiary industry activity fell 0.6% instead of posting the estimated 0.1% uptick.

Commodity Currencies (AUD, NZD, CAD)

The Loonie continued to advance on stronger hopes of an OPEC deal to cut production, as Russia is set to meet with Saudi Arabia, Venezuela, and Qatar today. New Zealand’s retail sales report came in closely in line with expectations, as headline consumer spending rose 1.2% while core consumer spending climbed 1.4%. In Australia, the RBA minutes failed to push AUD pairs lower, as the accommodative stance is already priced in. Canada’s manufacturing sales and New Zealand’s dairy auction are lined up next.

By Kate Curtis from Trader’s Way