Article Highlights

  • Commodity dollar weakness continues on weak Chinese data
  • Eurozone Manufacturing and Services PMI mostly reading above forecasts
  • U.K. CBI Distributive Trades comes in below expectations at 14 vs. 25 forecast and 34 previous
  • U.S. weekly Initial Claims better-than-expected at 326K vs. 330K forecast
  • Canadian Retail Sales better-than-expected: headline m/m at 0.6% vs. 0.2% forecast
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Lots of currency price action during the morning London session starting with the comdolls continuing their weakness thanks to China’s weak HSBC Flash Mfg PMI report (49.6 vs. 50.3 forecast).  The Aussie took the brunt of the reaction, falling across the board against the major currencies. Since the Asia session open, AUD is down around 65 pips (-0.76%) to .8785 against the Greenback, down against the British pound by around 178 pips (-0.95%), and down against the Japanese yen 120 pips (-1.31%).

From the Eurozone, we got a positive surprise on the Flash Manufacturing and Services PMI numbers in today’s forex calendar.  The German Flash Services PMI was the only oddball of the group, coming in at 53.6 vs. the 54.0 forecast, but it was a tick above the previous number of 53.5.  The euro was immediately bid higher against the majors, with EUR/USD up over 100 pips (+0.73%) since the data was released and climbing; the euro is also up against Sterling by 38 pips to .8226, or +0.46%.  This data might be a short-term game changer, or at the very least, a reason for euro shorts to cover and take profit.

We just received positive data from both the U.S. (weekly jobless claims) and Canada (retail sales).  The Loonie gained on the news, with USD/CAD declining 27 pips since the release of both data points, as well as taking back some of the weakness against the other major currencies over the past few trading sessions.

Later in the session, we still have U.S. existing home sales (expectations of 4.92M homes sold) and the leading indicator data (0.2% forecast).  These events aren’t usually big market catalysts, but both do have the potential to cause a stir with an outsized, surprise number.

See also:

Asian Session Recap

U.S. Session Recap

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