U.S. Session Recap – Aug. 27, 2014

  • US July durable goods orders up by 22.6% vs. 8% expected, 2.7% previous
  • US core durable goods orders down by 0.8% vs. 0.5% uptick expected, 3.0% previous
  • S&P house price index up by 8.1% vs. 8.3% expected, 9.4% previous
  • US August consumer confidence up to 92.4 vs. 89.0 expected, 90.3 previous
  • Richmond manufacturing index up to 12 vs. 8 expected, 7 previous in August

Thanks to positive US reports and a bit of risk aversion, the dollar dominated yesterday’s US forex trading session.

Uncle Sam’s durable goods orders report spurred Greenback bulls into action when it printed a whopping 22% gain in July on a surge in aircraft demand. Not only that, but consumer confidence hit a six-year high at 92.4 and Richmond’s manufacturing index rose to its fastest pace in three years. Talk about a triple threat!

The dollar’s strength would have probably waned if not for a bit of risk aversion in the markets. Word on the hood is that Ukraine had captured some Russian forces who had “mistakenly” crossed its borders. Russia hasn’t responded yet, and while Russia’s Putin and Ukraine’s Poroshenko held a meeting in Minsk, no major progress has been made.

EUR/USD unsurprisingly slipped by another 21 pips to 1.3171 while GBP/USD dropped to 1.6545 after hitting a resistance at 1.6594. Even USD/JPY and USD/CHF showed dollar strength with the former inching 11 pips higher to 104.05 and the latter rising by 13 pips to .9173.

As strong as the dollar’s performance is though, it was probably the Loonie that came out on top of the forex hill. AUD/USD and NZD/USD slipped by less than 10 pips, but USD/CAD fell by 14 pips to 1.0951. EUR/CAD also registered a 41-pip drop to 1.4424, GBP/CAD dropped by 51 pips to 1.8120, and CAD/JPY popped up by 22 pips to 95.02. Yowza! One possible explanation for the Loonie’s strength is that market players are just pricing in Canada’s strong reports and a possible merger between Burger King and Tim Horton’s after the Jackson Hole weekend.

Comdoll traders don’t have a lot to look forward to over the next couple of hours with only New Zealand’s food price index and Australia’s quarterly construction reports on tap. These reports don’t usually affect their respective currencies’ price action for long, so keep your eyes peeled for any other news that might influence risk sentiment during the Asian forex trading session!

See also:

London Session Recap

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