London Session Recap – January 17, 2014

  • Swiss Producer and Import Prices y/y come inline with -0.4% forecast
  • U.K. Retail Sales data surprises big time to the upside: headline m/m better-than-expected +2.6% vs. +0.3% forecast and +0.1% previous
  • U.S Housing Starts: 999K vs. 990K forecast; Building Permits: 986K vs. 1.01M forecast

Mixed priced action in the forex markets this morning with the U.S. dollar and Japanese yen continuing to see some strength against the commodity dollars, and a big move in Sterling thanks to U.K. retail sales data.

On this morning’s forex calendar, we saw a big upside surprise from all aspects of the U.K.’s retail data, both headline and core numbers were fantastic compared to the previous month and previous year.  This adds fuel to the positive sentiment that the U.K. is doing very well, and as a result we immediately saw a big pop in the British pound.  GBP/USD jumped 130 pips (+0.80%) within the first hour of the release, and should stay lofty for the rest of the session.

In the past hour, we got mixed housing data from the U.S.  Housing starts came in above expectations, but lower than the revised November read of 1.10M units.  Building permits also came in below the November number of 1.01M units, showing a trend of weakness in the U.S. housing market.  There was barely any reaction in the Dollar on the news.

For the rest of the Friday session, we have U.S. data on tap in the form of Industrial Production, Capacity Utilization rate, and the preliminary University of Michigan Consumer Sentiment survey. The expectation is that we will see better-than-previous numbers from all three, which means more gains from the Greenback against the weaker currencies like the comdolls.

See also:

Asian Session Recap

U.S. Session Recap

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