U.S. Session Recap – December 5, 2013

  • ADP employment report 215k vs 172k expected
  • U.S. new home sales 444k vs 425k expected in October
  • U.S. trade balance shows 40.6B USD deficit vs. 40.3B USD expected deficit
  • Canada trade balance at 0.1B CAD surplus vs. 0.7B CAD deficit expected
  • BOC keeps rates at 1.00%, worries over low inflation
  • ISM non-manufacturing PMI 53.9 vs 55.4 expected

Can you say see-saw trading? The major currencies were all over the charts yesterday as mixed economic data sent them in both directions during the U.S. session. The Greenback initially gained on its counterparts at the release of a better-than-expected ADP report, but was soon upstaged when the weal trade balance and ISM services PMI reports popped up to weaken prospects of a Fed taper.

Weak U.S. equities performance further weighed on the yen crosses, which influenced USD/JPY’s visit below 102.00. Risk aversion and dollar appetite also drove EUR/USD and GBP/USD to 1.3550 and 1.6350 respectively before dollar weakness boosted them back up to near their intraday highs.

Meanwhile the Bank of Canada kept its rates steady at 1.00%. The central bank recognized the improvement in the U.S. economy and the global markets, but it also stated its worry over tough domestic retail competition that is weighing down inflation. Not surprisingly, USD/CAD jumped to its 3-year highs at the prospect of more stimulus from the BOC

See also:

London Session Recap

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