U.S. Session Forex Recap – June 23, 2016

  • Canadian headline retail sales up 0.9% vs. 0.8% forecast
  • Canadian core retail sales up 1.3% vs. 0.7% forecast
  • U.S. existing home sales up from 5.43M to 5.53M as expected
  • U.S. crude oil inventories down 0.9 million barrels
  • Fed head Yellen: FOMC has no scheduled meeting after EU referendum
  • Brexit polls still showing mixed results

Based on the latest price action, it looks like markets are pricing in a Bremain victory but polls are still showing mixed results.

Major Events:

Canadian retail sales report – The only top-tier report on the docket for yesterday’s New York session was that of the Canadian retail sales, which printed stronger than expected results. Headline retail sales rose 0.9% versus the 0.8% forecast for April while the core figure printed a 1.3% gain versus the 0.7% estimate.

To top it off, the previous readings were upgraded to show smaller declines. Components of the April report showed that the gains were mostly driven by stronger sales in gasoline stations, followed by higher purchases in general merchandise stores.

Fed Chairperson Yellen’s speech – The Fed head honcho already shared most of her thoughts on the U.S. economy in her testimony earlier this week so most of her latest remarks were focused on the upcoming EU referendum. She clarified that, unlike some central banks, the Fed has no emergency meeting scheduled right after the Brexit vote, even if the U.K. does end up exiting. Yellen did note, however, that a strong dollar could be a drag on economic performance so watch out for a bit of jawboning if those safe-haven rallies kick in.

Mixed results from Brexit polls – It’s still a toss-up, people! The latest batch of opinion poll results gave mixed signals, with very tiny leads in favor of either camp. The online YouGov poll showed that 51% voted to remain while 49% voted to leave and the ComRes poll indicated that 48% voted to remain while 42% voted to leave. On the flip side, the TNS poll indicated that 43% voted to leave while 41% voted to remain and the Opinium poll showed that 45% voted to leave while 44% voted to remain.

Major Currency Movers:

GBP – Even with mixed Brexit poll results, the pound continued to trudge higher against most of its forex counterparts.

GBP/USD surged past the resistance at the 1.4700 handle to a high of 1.4845, GBP/JPY broke to the upside from consolidation and reached a high of 155.72, EUR/GBP fell from a high of .7717 to a low of .7643, and GBP/AUD rallied back to the 1.9700 handle.

USD & JPY – The lower-yielding Greenback and Japanese yen were in the losers’ bench for the past few hours, as risk appetite appeared to improve.

EUR/USD recovered from a session low of 1.1269 to a high of 1.1349, USD/CHF is slowly edging lower to the .9550 mark, AUD/USD moved past the .7500 barrier to a high of .7526, and USD/CAD is down to the 1.2800 mark. EUR/JPY advanced to a high of 119.06, AUD/JPY surged past 78.50 and is closing in on 79.00, and CAD/JPY bounced up to a high of 81.81.

See also:

Asian Session Recap

London Session Recap

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