- US CPI: 0.2% as expected vs. -0.7% previous
- US core CPI: 0.2% vs. 0.1% expected, 0.2% previous
- US FHFA house price index: 0.3% vs. 0.5% expected, 0.7% previous
- US flash manufacturing PMI: 55.3 vs. 54.6 expected, 55.1 previous
- US Richmond manufacturing index: -8 vs. +2 expected, 0 reading last month
- US new home sales: 539K vs. 464K expected, 500K previous
- NZ trade balance: 50M NZD vs. 375M NZD surplus expected, 33M NZD previous
A pretty mixed session for the major currencies, as forex traders priced in economic data from the U.S.
The dollar bulls initially got a boost from the U.S. CPI numbers, which showed increases in both the headline and core figures. However, focus soon turned to a lackluster wage growth, which limited the dollar’s intraday gains.
If you recall, the Fed is looking at both the inflation and wage growth in determining its rate hike schedule. Luckily for the dollar fans, better-than-expected reads in the manufacturing PMI and new home sales reports helped keep the dollar afloat for the rest of the session.
EUR/USD hit a high at 1.1029 before settling back down to 1.0924 while GBP/USD slipped by 61 pips (-0.41%) to 1.4850 after spiking higher to 1.4984. USD/JPY also hit an intraday low of 119.22 before it ended the session at 119.75.
Even the comdolls got their slice of dollar whipsaw pie. AUD/USD hit .7938 before closing 19 pips lower (-0.24%) to .7878 while USD/CAD fell to 1.2428 before rising back up to 1.2493.
The Swiss franc was another currency of note, as it gained against the European currencies. No apparent catalyst was involved, EUR/CHF extended its early London session losses to close 43 pips lower (-0.41%) to 1.0468 while GBP/CHF also fell by 42 pips (-0.29%) to 1.4229.
Since New Zealand has already printed its trade data (which came in weaker than market expectations), Asian session forex traders don’t won’t have much else to price in. Instead, they can keep an eye out for any changes in dollar sentiment or any reports that might affect demand for high-yielding currencies.
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Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!