U.S. Session Forex Recap – August 24, 2016

  • U.S. flash manufacturing PMI down from 52.9 to 52.1 in Aug
  • Richmond manufacturing PMI fell from +10 to -11 vs. +6 forecast
  • U.S. new home sales at 654K vs. 575K forecast in July
  • U.S. June new home sales downgraded from 592K to 582K
  • New Zealand July trade deficit at 433M NZD vs. projected 320M NZD shortfall
  • New Zealand June trade surplus downgraded from 127M NZD to 110M NZD

The Greenback was all over the place as the lack of top-tier U.S. data left the currency with a mixed scorecard against its forex peers.

Major Events:

Downbeat medium-tier U.S. data  The latest batch of reports came in mostly weaker than expected, signaling that the U.S. economy isn’t out of the woods just yet. The flash manufacturing PMI for August landed at 52.1 from the previous 52.9 figure to show a slower pace of industry growth instead of climbing to the estimated 53.1 reading. Also, the Richmond manufacturing PMI slumped from +10 to -11, which reflects industry contraction, worse than the projected dip to +6.

Meanwhile, new home sales for July came in at a solid 654K versus the 575K forecast. However, the June reading was downgraded slightly from the initially reported 592K figure to just 582K.

New Zealand trade balance – Before U.S. session traders were able to call it a night, New Zealand printed its July trade balance and showed a worse than expected 433 million NZD deficit versus the projected 320 million NZD shortfall. This also represents a slowdown in trade activity from June’s 110 million NZD surplus, which was downgraded from the initially reported 127 million NZD surplus.

Components of the July report showed that goods exports fell by 205 million NZD while imports sank by 503 million NZD, indicating declines in both external and domestic demand. As it turns out, consumption goods imports fell in value for the first time in nearly two years.

Major Currency Movers:

USD – While the U.S. dollar ended the day mixed, it was still able to make some significant moves across the board.

EUR/USD retreated from 1.1344 to end the day at 1.1305 (-0.34%), GBP/USD carried on with its climb from 1.3187 to a high of 1.3212 (+0.19%), USD/JPY climbed from 100.08 to a high of 100.37 (+0.29%), and USD/CHF recovered from .9609 to .9635 (+0.27%).

The comdolls were off to a good start but eventually gave up ground to the dollar, with AUD/USD back down to .7613, NZD/USD at .7280, and USD/CAD at 1.2921.

Watch Out For:

  • 1:30 am GMT: Australia construction work done q/q (-1.9% expected, -2.6% previous)

See also:

Asian Session Recap

London Session Recap

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