Article Highlights

  • US retail sales: 0.1% vs. 0.2% expected, last month’s data revised from 0.1% to 0.0%
  • US core retail sales: -0.3% vs. -0.1% expected, -0.1% previous
  • US PPI: -0.5% vs. -0.2% expected, 0.0% previous
  • US core PPI: -0.3% vs. 0.1% expected, 0.3% previous
  • US business inventories: 0.0% vs. 0.1% expected, 0.0% previous
  • US Fed Beige Book report shows moderate growth
  • AU employment numbers due today
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Geronimooooo!!! The dollar gave up pips to its major forex counterparts thanks to an onslaught of disappointing U.S. data.

Volatility came alive for the dollar pairs yesterday after Uncle Sam printed its retail sales and producer price index (PPI) numbers and the Fed released its Beige book report. Unfortunately for dollar bulls, most of yesterday’s reports disappointed market expectations.

The biggest story of the hour was the retail sales data. Not only did September’s growth disappoint with only a 0.1% uptick (vs. 0.2% growth expected), but August’s growth was also revised from 0.1% to 0.0%. The PPI numbers also got attention when it clocked in a 0.5% decline, its steepest drop in eight months and in 2015.

Last but not the least is the Fed’s Beige book report, which showed that the economy grew modestly as a strong Greenback weighed on manufacturing and tourism. With oil prices dipping further and consumer prices already expected to show limited growth, yesterday’s reports provided fuel to speculations that the Fed won’t hike its interest rates this year after all. Duhn duhn duhn duhn.

EUR/USD shot up by 79 pips (+0.69%) to 1.1485 while GBP/USD, already higher on the U.K,’s better-than-expected jobs reports, popped up by another 118 pips (+0.77%) to 1.5487. The low-yielding currencies also scored pips on the dollar with USD/JPY falling by 83 pips (-0.69%) to 118.71 and USD/CHF sliding by 62 pips (-0.65%) to .9494.

The comdolls were also firmly on the dollar selloff bandwagon though not without slight pushes from other factors. Gold prices hit a three-and-a-half month high yesterday thanks to diminishing chances of a 2015 Fed rate hike. Meanwhile, the Kiwi continued to find support from RBNZ Governor Wheeler’s less-dovish-than-expected speech. And with oil prices barely making any moves, the Loonie was able to get the full impact of the dollar’s selloff.

AUD/USD ended the session 49 pips higher (+0.68%) to .7307 while NZD/USD popped up by 45 pips (+0.67%) to .6784 and USD/CAD plunged by 66 pips (-0.51%) to 1.2922.

Will Asian session forex traders extend yesterday’s dollar selloff theme? Aussie traders will probably have more to consider as the Land Down Under releases its employment numbers at 12:30 am GMT.

According to Forex Gump’s trading guide, market players are expecting the unemployment rate to remain at 6.2% while a net of 7,200 workers is expected to have found jobs (vs. 17,400 last month). Lower readings could inspire some retracements from yesterday’s Aussie gains and even inspire a bearish intraday trend, so make sure you stick around when the reports are printed!

See also:

London Session Recap

Bonnie and Clyde, peanut butter and jelly, Kanye West and Kanye West. Some things just go well together.

In forex trading, you get better odds at securing pips when your fundamental analysis is complemented by technical analysis. Head on to Big Pippin’s Daily Chart Art for some pip-locking technical weeks!