U.S. Session Forex Recap – Nov. 12, 2015

  • U.S. banks closed for Veterans’ Day holiday
  • ECB official Constancio: Policy must remain accommodative
  • ECB member Coeure: ECB doesn’t have to act in December
  • ECB policymakers mixed on further deposit rate cuts

Lower liquidity during the U.S. Veterans’ Day holiday wasn’t enough to stop currencies from busting their moves across the forex charts, as oil price action and European market events gave a bit of direction.

Major Events:

ECB commentary – Forex junkies have been buzzing about the higher odds of additional ECB stimulus for quite some time, but it looks like policymakers aren’t quite sure how to go about it yet.

For ECB official Constancio, monetary policy must remain accommodative but policymaker Hansson said that there’s no need to lower deposit rates yet and that they should wait until next year to reexamine the current easing program. Ditto for ECB member Coeure who said that the central bank doesn’t necessarily have to act in December.

Downbeat medium-tier NZ data – Even though the RBNZ tried to give some words of reassurance in their Financial Stability Report released yesterday, the economic data painted a different picture of the New Zealand economy. The Business NZ manufacturing index dropped from 55.0 to 53.3 in October, indicating a slower pace of industry growth, while the food price index for the same month chalked up a 1.2% decline. Guess what’s to blame for the tumble… Yep, that’s right, dairy.

Major Currency Movers:

GBP – Sterling continued its ascent, thanks to relatively upbeat U.K. jobs data released during the European session. While a couple of figures still fell short of expectations, the jobless rate fell to yet another record low while a known BOE dove Haldane shifted to a neutral stance.

GBP/USD kept climbing past the 1.5200 major psychological mark to a high of 1.5220, GBP/JPY reached a high of 187.04 before retreating to 186.88, and EUR/GBP dipped slightly below the .7050 support zone then recovered to .7067.

CAD – The Canadian currency tossed and turned during the entire trading session, as oil prices popped to the $44/barrel level before resuming its tumble down to $43/barrel.

USD/CAD dipped to a low of 1.3229 then jumped back up to 1.3278 before settling around the 1.3250 minor psychological level, CAD/JPY rallied to a high of 92.96 then retreated to a low of 92.50, EUR/CAD tested support at the 1.4200 major psychological mark and is up to 1.4252.

Watch Out For:

  • Japanese core machinery orders at 12:50 am GMT (+3.3% consensus, -5.7% previous)
  • Japanese PPI at 12:50 am GMT (-3.5% consensus, -3.9% previous)
  • Australian Oct employment change at 1:30 am GMT (+14.8K consensus, -5.1K previous)

See more:

Asian Session Recap

London Session Recap

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