U.S. Session Recap – March 6, 2014

  • ADP non-farm employment at 139K vs. 127K previous
  • US ISM non-mfg PMI at 51.6 vs. 53.5 expected
  • BOC: downside inflation risks remain important
  • Yellen: economy operating short of Fed’s goals

What a topsy-turvy day for the Greenback! The low-yielding currency could have ended the day on the red if traders had only focused on Uncle Sam’s reports. The ADP report might have printed a bit above expectations but its downward revision to the previous month’s data offset the positive vibes. Not only that, but the ISM non-manufacturing PMI report had also missed its estimates. Overall these reports did not bode well for tomorrow’s NFP report.

Luckily for the dollar, investors were also thinking about today’s major events. As Forex Gump mentioned in his forex trading guide, we’ll see the BOE and ECB rate statements, central bank speeches, and a couple of US and Canadian reports. This is probably why the euro, pound, yen, and the franc gave up some pips to the Greenback by the end of the session.

The Loonie also snuck a few pips from the dollar after the BOC released its policy statement. Although the central bank recognized the better-than-expected Q4 2013 growth performance, it warned that Q1 2014 might not be as rosy. In addition, the BOC relayed its concerns about the downside risks to inflation. USD/CAD still fell though, probably due to the momentum caused by USD selling at the beginning of the session.

Let’s see if the comdolls continue to strengthen against the dollar today. A few hours ago Australia printed strong retail sales and trade balance numbers, which has already lifted AUD/USD by about 40 pips in the Asian session. No other major report is scheduled until the London session so keep an eye out in case we see sentiment-changing news!

See also:

London Session Recap

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