U.S. Session Recap – June 5, 2014

  • US ADP report prints at 179K vs. 210K expected and 215K previous
  • US trade balance shows 47.2 billion USD deficit vs. 40.8 billion USD deficit expected
  • US ISM non-manufacturing PMI clocks in at 56.3 vs. 55.5 expected and 55.2 previous
  • US Beige book report shows moderate expansion in the 12 Fed districts
  • CA trade balance shows 0.64 billion CAD deficit vs. 0.8 billion CAD surplus in March
  • BOC keeps rates unchanged, not as pessimistic on inflation as expected

It’s the final countdown! The major currency pairs reversed most of their early London session moves as traders count down the final hours before the highly awaited ECB monetary policy decision. Of course, it didn’t hurt forex trading volatility that we also saw tier 1 and 2 reports released throughout the session.

The Greenback took hits across the board at the start of the session when Uncle Sam’s ADP employment numbers and trade balance report missed market expectations. The bulls were on standby though, so it was easy for the dollar to recoup its losses when the ISM non-manufacturing PMI exceeded analyst forecasts and the Beige book report showed growth across all 12 of the Fed districts.

USD/JPY closed 30 pips higher than its session open price at 102.75, EUR/USD dropped 35 pips to 1.3599, GBP/USD fell 23 pips to 1.6737, and USD/CHF inched 14 pips to .8973.

Canada’s first trade deficit in three months also hit the forex headlines. Canada’s exports posted its biggest decline in six months while imports hit record levels. Yikes! Fortunately for the Loonie bulls, the BOC’s monetary policy decision was less dovish than expected and helped keep the Loonie bids afloat.

USD/CAD ended the session only 14 pips higher at 1.0939 while CAD/JPY recovered all of its losses with a 3-pip gain at 93.91.

In today’s Asian session trading we’ll see Australia’s trade balance report at 1:30 am GMT, followed by China’s HSBC services PMI at 1:45 am GMT. Market players are expecting slightly lower numbers, so watch your Aussie trades closely in case the reports come in weak!

See also:

London Session Recap

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