London Session Recap – December 18, 2013

  • U.K. Nov claimant count change at -36.7K versus -35.2K expected
  • U.K. Oct claimant count change revised from -41.7K to -42.8K
  • U.K. jobless rate down from 7.6% to 7.4%
  • German Ifo business climate index up from 109.3 to 109.5
  • FOMC statement coming up

The pound was a big winner in today’s London trading session, as the U.K. reported stronger than expected jobs data. Not only did the November claimant count change come in better than expected at -36.7K versus the estimated -35.2K reading, but the previous month’s figure was revised from -41.7K to -42.8K. Aside from that, the jobless rate improved from 7.6% to 7.4%.

On the other hand, the euro retreated when the German Ifo business climate index fell slightly below consensus, as the figure came in at 109.5, a couple of notches shy of the estimated 109.7 reading.

Meanwhile, the U.S. just reported a better than expected housing starts figure of 1.09M for November, while the September and October data both fell short of expectations. However, this didn’t cause much of an effect among dollar pairs, as traders are sitting on the edge of their seats waiting for the FOMC statement.

A decision to taper could be positive for the U.S. dollar, but the price reaction could depend on the size of the reduction and the Fed’s forward guidance remarks. An announcement delaying the taper could be met with a strong dollar selloff, as traders don’t foresee any form of tightening taking place during incoming Fed head Janet Yellen’s term.

In any case, stay on your toes for potential fireworks and make sure you set your stops right if you plan to keep any trades open during the event!

See also:

Asian Session Recap

U.S. Session Recap

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