U.S. Session Forex Recap – September 10, 2015

  • US JOLTS job openings: 5.75M vs. 5.30M expected, 5.32M previous
  • EIA lowers U.S. demand forecasts for 2016
  • BOC leaves interest rates unchanged at 0.5%
  • CA housing starts: 217K vs. 191K expected, 193K previous
  • CA building permits: -0.6% vs. -5.0% expected, 15.5% previous
  • UK NIESR GDP estimate: 0.5% vs. 0.6% previous
  • Gold and oil lower on the day
  • RBNZ cuts interest rates from 3.0% to 2.75%, says further easing seems “likely”
  • Japan core machinery orders on tap
  • Australia to release its employment numbers today

Are U.S. traders back or what? Thanks to a slew of tier 1 reports, forex trading during the U.S. session fired up and pushed the major currencies all over the charts.

High-yielding currencies started the session on a positive note, thanks in part to a better-than-expected U.S. JOLTS job openings data. Unfortunately for forex bulls, risk sentiment soured when the rest of the reports trickled in.

The Bank of Canada (BOC)’s decision to maintain its rates at 0.5% was widely expected, so Loonie traders focused on the building permits (which came out weak) and housing starts (which came out stronger-than-expected).

The bigger headline-maker though, was the U.S. Energy Information Administration (EIA) lowering both its supply and demand forecasts for 2015 and 2016 though market players only focused on the latter. The organization now expects a demand growth of 130,000 barrels per day (bpd) in 2016 instead of 190,000 bpd while demand growth for 2015 was lowered from 400,000 bpd to 330,000 bpd. This, coupled with Chinese growth concerns and uncertainty over the Fed’s rate hike schedule, is probably why oil prices fell by another 3.9% to $44.15 per barrel. Yikes!

It also didn’t help risk appetite that the Reserve Bank of New Zealand (RBNZ) triple roundhouse-kicked the markets with its monetary policy decision. Not only did the central bank lower its interest rates for the third month in a row, but it also hinted that further easing AND Kiwi weakness are likely. The cherry on top of the RBNZ’s dovish news is that it also lowered growth and inflation forecasts, which are reasons why the central bank had lowered its rates in the first place. Duhn duhn duhn duhn.

The European currencies escaped the dollar’s wrath with EUR/USD actually climbing by 69 pips (+0.62%) to 1.1207 while GBP/USD lollygagged around the 1.5350 area. The dollar also lost pips to its low-yielding counterparts with USD/JPY falling by 48 pips (-0.37%) to 120.48 and USD/CHF slipping by 35 pips (-0.36%) to .9752.

Unsurprisingly, it was the comdolls that got hit the most after yesterday’s monetary policy announcements. USD/CAD jumped by 94 pips (+0.72%) from its intraday low of 1.3155 while CAD/JPY fell by 40 pips (-0.40%) to 90.94 and EUR/CAD popped up by 99 pips (+0.67%) to 1.4848. The Kiwi was a bit luckier with NZD/USD and NZD/JPY ending the session with tight ranges at .6400 and 77.50 respectively before dropping by hundreds of pips at the release of the RBNZ’s monetary policy decision.

Will the comdolls get any pips in today? Asian session forex traders have a lot on their plates starting with Japan’s core machinery tools orders report at 11:350 am GMT, followed by Australia’s MI inflation expectations at 1:00 am GMT.

The biggest potential mover won’t come until around 1:30 am GMT though, when the Land Down Under prints its employment numbers. Read Forex Gump’s trading guide if you’re planning on trading the monster report!

See also:

London Session Recap

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