U.S. Session Forex Recap – May 31, 2016

  • Canadian current account deficit widened from 15.7B to 16.8B CAD
  • Canada’s raw material price index up by 0.7% vs. 2.2% forecast
  • Canada’s industrial product price index down by 0.5% vs. projected 0.2% uptick
  • New Zealand building consents rebounded by 6.6% in April

With U.S. traders out on a Memorial Day holiday, forex market participants had a bit of profit-taking going on during the New York session.

Major Events:

Economic data from Canada – The only reports on yesterday’s docket were from Canada, and the actual numbers didn’t look too good. First off, the current account deficit widened from a downgraded 15.7 billion CAD shortfall to 16.8 billion CAD. Components of the report revealed that a larger deficit on international trade in goods was seen, which basically means that export activity didn’t fare so well in the first quarter.

Moving on, underlying inflation reports also failed to impress, as the raw material price index rose 0.7% versus the 2.2% forecast while the industrial product price index posted a 0.5% drop versus the projected 0.2% uptick.

Major Currency Movers:

USD – The Greenback gave back some of its recent gains, as traders from the U.S. were enjoying the long weekend and catching up on the latest Game of Thrones episode.

EUR/USD pulled up from the 1.1100 levels to a high of 1.1148, GBP/USD climbed from a low of 1.4588 to the 1.4650 minor psychological level, USD/JPY peaked at 111.46 then retraced to the 111.00 support level, and USD/CHF found resistance at the .9950 level and is down to .9915.

JPY – The Japanese yen recovered from its losses earlier in the day, thanks to profit-taking throughout the U.S. session.

EUR/JPY came close to the 124.00 handle before retreating to 123.62, GBP/JPY is consolidating at the 162.75 area, AUD/JPY stalled upon reaching a high of 79.91 then moved sideways, and CAD/JPY hit a high of 85.31 then pulled back to the 85.00 handle.

Watch Out For:

  • 11:30 pm GMT: Japanese household spending y/y (-1.3% expected, -5.3% previous)
  • 11:30 pm GMT: Japanese unemployment rate (3.2% expected and previous)
  • 11:30 pm GMT: Japanese industrial production m/m (-1.4% expected, +3.8% previous)
  • 1:00 am GMT: New Zealand ANZ business confidence (6.2 previous)
  • 1:30 am GMT: Australian building approvals (-3.1% expected, +3.7% previous)
  • 1:30 am GMT: Australia’s current account balance
  • 1:30 am GMT: Australia’s private sector credit (0.5% expected, 0.4% previous)
  • 5:00 am GMT: Japanese housing starts (3.9% expected, 8.4% previous)

See also:

Asian Session Recap

London Session Recap

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