Article Highlights

  • U.S. initial jobless claims at 246K vs. 252K forecast
  • U.S. import prices up 0.1% as expected in Sept
  • U.S. crude oil inventories rose by 4.9 million barrels
  • Fed official Harker: Might be better to wait after elections to hike
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Profit-taking was the name of the game in the U.S. session as the Greenback returned some of its recent wins to its rivals.

Major Events:

Upbeat medium-tier U.S. data – Economic reports from Uncle Sam still came in line with expectations, keeping investors hopeful about a rate hike before the end of the year. Initial jobless claims stood at 246K, same as in the previous week and lower than the estimated 252K figure. Import prices posted a 0.1% uptick for September as expected, indicating a rebound from the earlier 0.2% decline.

According to Fed official Harper, who will be a voting member by next year, these improvements in hiring and inflation are enough to warrant a rate hike by year end. He mentioned that there are signs of positive wage pressures but that business investment remains feeble. Apart from that, he cautioned that it might be better to wait after the U.S. elections before tightening.

Crude oil news – The U.S. Energy Information Administration reported a larger than expected buildup in stockpiles of 4.9 million barrels, reviving fears of an oversupply. This also capped off the five consecutive weekly declines in crude oil inventories, bringing WTI crude oil down to a low of $49.35/barrel and Brent crude oil down to $51/barrel during the release.

The commodity made a quick comeback, however, when investors noticed that U.S. production was significantly lower for the week. The EIA report indicated that production was down by 36,000 barrels per day to 7.969 million barrels per day, its lowest level since June 2014.

Major Market Movers:

USD – The U.S. dollar retreated across the board as traders likely booked profits off their recent long positions and risk appetite improved slightly.

EUR/USD pulled up from 1.1029 to a high of 1.1058, GBP/USD climbed from 1.2206 to 1.2272, USD/JPY fell from 103.82 to a low of 103.33, USD/CHF slid from .9889 to a low of .9862, NZD/USD climbed from .7069 to a high of .7097, and AUD/USD is up to .7586.


Watch Out For:

  • 12:30 am GMT: RBA Financial Stability Review
  • 1:30 am GMT: Chinese CPI y/y (1.6% expected, 1.3% previous)
  • 1:30 am GMT: Chinese PPI y/y (-0.4% expected, -0.8% previous)

See also:

London Session Recap

Asian Session Recap

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