Article Highlights

  • Swiss jobless rate: 3.7% vs. 3.6% expected, 3.4% previous
  • German industrial production m/m: -0.3% vs. 0.5% expected, 0.5% previous
  • German trade balance: €20.6B vs. €20.2B expected, €22.3B previous
  • French industrial production m/m: -0.9% vs. -0.3% expected, 0.7% previous
  • French trade balance: -€4.63B vs. -€3.95B expected, -€4.87B previous
  • Swiss CPI m/m: -0.4% vs. -0.3% expected, -0.1% previous
  • Swiss CPI y/y: -1.3% vs. -1.2% expected, -1.4% previous
  • U.K. trade balance: -£10.64B vs. -£10.5B expected, -£11.2B previous
  • NFP Friday!
  • Canadian jobs data also on tap
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Volatility dried up and most currency pairs were trading sideways during today’s London trading session, as forex traders sat on their hands ahead of the NFP report. The Aussie and the Kiwi were pretty active, though.

Major Events:

Mild risk aversion lingers in European markets – Despite improving sentiment during the Asian forex session due to a recovery in the Chinese stock market and a higher peg on the yuan, European market players were still a bit bummed out because European equities turned lower after a strong start, with the pan-European FTSEurofirst 300 down by 0.27% to 1,357.25 and the DAX down by 0.12% to 9,975.00 during the morning London forex session.

Oil prices recover a bit – Oil prices were off their 12-year lows during the forex session, with U.S. crude oil up by 0.83% to $33.50 per barrel and Brent crude oil up by 1.14% to $34.10 per barrel on improving sentiment over China.

NFP Friday! – Normally, volatility dries up ahead of the NFP report, and today was certainly very normal since most currency pairs were peacefully trading sideways in relatively tight ranges during the course of the forex session. Still, there were a few currencies that were clearly on the move, which y’all can read about below. And if you haven’t already, you can read Forex Gump’s Forex Trading Guide for the NFP report here.

Major Currency Movers:

AUD & NZD – The Aussie and the Kiwi were both losing ground against all of their forex rivals, with the Kiwi being the weaker among the two. It could have been due to the mild risk aversion during the forex session, but that doesn’t really explain their broad weakness and a lack of demand for the safe-havens. The PBoC did release a press release during the session, stating that the Bank will be maintaining its prudent monetary policy, which probably made some forex traders think that another surprise rate cut or some other easing move is in the works. Well, whatever the case may be, the fact remains that these two currencies were very weak during the session.

NZD/USD was down by 46 pips (-0.70%) to 0.6602, NZD/JPY was down by 52 pips (-0.66%) to 78.10, NZD/CAD was down by 72 pips (-0.77%) to 0.9308

AUD/USD was down by 26 pips (-0.37%) to 0.7010, AUD/JPY was down by 29 pips (-0.36%) to 82.91, AUD/NZD was up by 38 pips (+0.37%) to 1.0619

CAD – Loonie pairs were actually well-behaved for most of the forex session, but suddenly began gaining across the board, probably on the back of the recovery in oil prices. But it’s also possible that forex traders (who were late to the party) were opening preemptive positions on the Loonie given that Canada is expected to print a decent jobs report later.

USD/CAD was down by 11 pips (-0.08%) to 1.4096, AUD/CAD was down by 44 pips (-0.45%) to 0.9882, GBP/CAD was down by 66 pips (-0.32%) to 2.0562

Watch Out For:

  • 1:30 pm GMT: Canadian jobless rate (7.1% expected, 7.1% previous)
  • 1:30 pm GMT: Canadian employment change (8K expected, -35.7K previous)
  • 1:30 pm GMT: Canadian building permits (-2.9K expected, 9.1K previous)
  • 1:30 pm GMT: U.S. non-farm payrolls (200K expected vs. 211K previous)
  • 1:30 pm GMT: U.S. jobless rate (expected to hold steady at 5.0%)
  • 1:30 pm GMT: Average hourly earnings (0.2% expected, same as previous)
  • 3:00 pm GMT: U.S. wholesale inventories (-0.1% expected, -0.1% previous)
  • 8:00 pm GMT: U.S. consumer credit ($18.00B expected, $15.98B previous)

See also:

Asian Session Forex Recap

U.S. Session Forex Recap

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