Article Highlights

  • Swiss Unemployment Rate m/m: 3.4% vs. 3.4% forecast, 3.2% previous
  • German Industrial Production m/m: -0.1% vs. 0.3% forecast, 0.6% previous
  • German Trade Balance: 17.9B EUR VS. 20.4B EUR forecast, 22.1B EUR previous
  • French Industrial Production m/m: -0.3% vs. 0.3% forecast, -0.7% previous
  • Swiss CPI m/m: -0.5% vs. -0.3% forecast, 0.0% previous
  • U.K. Industrial Production m/m: -0.1% vs. 0.2% forecast, -0.3% previous
  • U.K. Manufacturing: 0.7% vs. 0.3% forecast, -0.7% previous
  • U.K. Trade Balance: -8.85B GBP vs. -9.5B GBP forecast, -9.84B GBP previous
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Forex volatility picked up in the morning London session thanks to a very heavy European region calendar covering mostly industrial, manufacturing, and trade data.

The biggest mover of the morning is probably the British pound, likely moving higher on positive manufacturing and trade balance data, but possibly also on a little bit of profit taking with Sterling under pressure all week.

GBP/USD is up 56 pips (+0.38%) to 1.5140, GBP/CAD is up 65 pips (+0.37%) to 1.7907, and GBP/NZD is up 99 pips (+0.51%) to 1.9370

The Kiwi seems to be the other market mover, continuing its decline from the Asia session, possibly sparked by weak Chinese producer prices, but there is not direct catalyst at the moment. NZD/USD is down 6 pips on the session, but down from session highs around .9266 to as low as .9232, and NZD/JPY is down 41 pips (-0.44%) to 93.15.

And the Greenback seems to be giving back some gains ahead of the highly anticipated month U.S. employment data:

USD/JPY is down 39 pips (-0.33%) to 119.19, USD/CHF  is down 16 pips (-0.16%) to 1.0165, and USD/CAD is down 8 pips (-0.7%) to 1.1818

It’s the first Friday of the month, so the forex calendar for the afternoon London/morning U.S. session is packed with tier one events with huge potential to ignite volatility.

At 1:30 pm GMT, we’ll get job sector updates from both Canada (Net Change: 15K forecast vs. -10.7 previous) and the U.S. (NFP: 225K forecast vs. 314K previous).  Both are market movers, but the U.S. numbers are the highly anticipated ones with broad market influence because it calculates heavily into the Fed’s monetary policy decisions. While reaching the 314K number is highly unlikely, the 240K range is positive for the U.S., especially if we see the unemployment rate ticks lower to 5.7% from 5.8%.

We’ll also get Canadian housing starts (192K forecast vs. 195K previous) and building permits (0.5% previous vs. 0.7% previous), but the jobs data will most likely be the only focus for forex traders during this hour, and volatility will most likely rise very quickly so be very aware of where your orders and trades are during this event to avoid slippage and whipsaw.

At 3:00 pm GMT, we’ll get U.S. wholesale inventories data (0.3% forecast vs. 0.4% previous) and U.K. NIESR GDP data (0.7% previous). Both are mid-tier events that should be watched, but unless we see huge surprises, the morning jobs reports will likely continue to be the main focus for traders going into the weekend. Stay frosty!

See also:

Asia Session Recap

U.S. Session Recap

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