U.S. Session Recap – August 1, 2014

  • CA GDP: 0.4% vs. 0.4% expected and 0.1% last month
  • US initial jobless claims: 302K vs. 300K expected and 279K previous
  • US quarterly employment cost index: 0.7% vs. 0.5% expected and 0.3% previous
  • US Chicago PMI: 52.6 vs. 63.0 expected and 62.6 previous
  • US equities take huge hits on end-of-month profit-taking

Despite a couple of possible market movers, most of the major currencies remained in their intraday ranges during the US forex trading session.

The trading session kicked off with Uncle Sam printing slightly better-than-expected data. For instance, quarterly wage growth printed at its fastest rate in six years while the four-week average of initial jobless claims fell to its lowest since 2006. While these still won’t likely convince the Fed to raise its rates this year, it might convince its members to adopt a more hawkish tone in their next meeting.

Unfortunately for the bulls, the Greenback didn’t get much action from the US’ positive reports. Instead, traders had focused on end-of-month profit-taking in the equities markets. The DJIA dropped 300 points and erased its 2014 gains while the S&P 500 posted its sharpest decline since April. No wonder the dollar had trouble popping up!

EUR/USD barely moved away from the 1.3380 handle, USD/JPY remained in a tight range at 102.70, GBP/USD finished the session with only a 7-pip gain, and USD/CHF stayed below the .9100 handle. Only the Loonie got decent action after Canada released its GDP numbers. A positive growth reading dragged USD/CAD fell from 1.0920 and visited the 1.0870 area before closing at 1.0904.

Will the yen bulls step up in the absence of the dollar bulls? China has just printed its manufacturing PMI (51.7 vs. 51.4 expected) but Australia has yet to release its quarterly PPI numbers. Analysts expect a 0.7% growth after rising by 0.9% in the previous quarter. Then, at 1:45 am GMT China will also print its HSBC manufacturing PMI report. Market players expect the index to remain at 52.0 but keep your eyes peeled in case the data surprises to the downside!

See also:

London Session Recap

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