U.S. Session Forex Recap – August 5, 2016

  • U.S. initial jobless claims up 269K vs. 265K forecast
  • U.S. Challenger job cuts down 57.1% in July
  • U.S. factory orders down 1.5% vs. projected 1.8% drop
  • Australia AIG construction index down from 53.2 to 51.6

U.S. session traders reacted quickly to the BOE’s decision to cut rates and increase bond purchases, but commodity price action eventually stole the spotlight.

Major Events:

Post-BOE market action New York session traders woke up to the news that the BOE cut interest rates by 0.25% and even expanded its bond purchases. Minutes of the MPC meeting revealed that the vote to cut rates was unanimous while the vote to increase stimulus to 435 billion GBP was at 6-3. For more deets on this announcement, make sure you check out my London session recap!

U.S. economic data Economic data from the U.S. came in mixed, as initial jobless claims were slightly worse than expected at 269K versus the 265K forecast and the previous 266K figure. Challenger job cuts fell by a whopping 57.1% in July, following the smaller 14.1% drop in June. Meanwhile, factory orders showed a 1.5% decline compared to the projected 1.8% drop for June but the May reading was downgraded to show a larger 1.2% fall from the initially printed 1.0% decline.

More crude oil gains  Thanks to the pickup in risk appetite from the earlier trading session, commodity prices and comdolls managed to chalk up a few gains. Apart from that, the drop in U.S. natural gas storage put upward pressure on energy prices once more, driving WTI crude oil up to $41.93/barrel (+2.69%).

Major Currency Movers:

GBP – The pound had a bit more energy left in its dive at the start of the session before consolidating at the end of the day.

GBP/USD continued to slide from 1.3149 to a low of 1.3102 (-0.36%), GBP/JPY carried on with its drop from 133.07 to close at 132.85 (-0.17%), EUR/GBP climbed from .8458 to .8495 (+0.44%), GBP/NZD slid from 1.8282 to a low of 1.8240 (-0.23%), and GBP/CHF dropped from 1.2806 to a low of 1.2758 (-0.38%).

AUD & CAD – The Aussie and Loonie teamed up against their lower-yielding rivals to rake in some gains on risk-taking.

AUD/USD advanced from .7615 to .7634 (+0.32%), USD/CAD found resistance near 1.3100 then tumbled to a low of 1.2995 (-0.80%), AUD/JPY is up from a low of 76.92 to 77.23 (+0.40%), and CAD/JPY rose from 77.42 to close at 77.70 (+0.36%).

Watch Out For:

See also:

Asian Session Recap

London Session Recap

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