Article Highlights

  • U.S. FHFA House Price Index m/m inline with 0.5% forecast/previous
  • U.S. Flash Manufacturing PMI at 51.4, below 51.9 forecast  but a tick above the 51.3 previous reading
  • Richmond Fed Factory Index spike to +22 in March vs. -4 in February
  • Canadian 2016 Budget released; plans for increase spending
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Forex traders went bullish on risk sentiment–despite the terror attack on Brussels–to push high-yielders up in the U.S. trading session.

Major Events/Reports:

Mixed U.S. economic data – After a disappointing U.S. existing home sales data release yesterday, the FHFA house price index was somewhat of a minor bright spot by coming in at least in-line with expectations/forecast at 0.5%.  This shows that house prices remained at steady growth despite the a weak housing number yesterday.

We also got the flash manufacturing PMI number, showing a slight dip below expectations, but above the previous read by a smidge at 51.4. The tick higher from last month’s read was due to hiring and new business improvements, but overall a disappointment as recent manufacturing surveys have been stronger than expected.

And the Richmond Fed factory index jumps to high levels not seen since 2010.  This read covers manufacturing in the lower Atlantic region of the U.S., possibly contributing to today’s bounce back into risk on mode after the horrific attack in Brussels earlier in the day.

Annual Canadian Budget – The Canadian government proposed new measures to help stimulate the economy after being hit hard due to the commodity rout in 2015 and early 2016, especially oil prices.  They look to break the previous administrations plan of controlled budgets, expecting to balloon the debt $100B in the next years, and hopefully adding 0.5% growth in 2016 and 1% in 2017.

Major Currency Movers:

Comdolls – Risk sentiment turned to the upside after the terrorist attack fears in London trade, possibly on the Richmond Fed Index news and Canadian budget plans.  Whatever the case may be, the comdolls certainly benefitted in the U.S. session as all three currencies managed to make gains against the Greenback into the London close.

USD/CAD dropped from 1.3138 to 1.3030, AUD/USD rallied from a .7551 low in Europe to a .7642 high, and NZD/USD reached as high as .6772 in U.S. trade before closing the session around .6750

JPY – And as usual in risk-on scenarios, the Japanese yen sold off across the board with EUR/JPY finding support at 125.00 to close the session higher up 0.64% to 125.98, GBP/JPY up slightly from the U.S. session open by 0.11% to 159.57, and USD/JPY rising about 0.60% to close U.S. trading around 112.32

Watch Out For:

  • No major economic releases in the upcoming Asia session.  Look for sentiment to remain as the main driver for price action.

See also:

Asian Session Recap

London Session Recap

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