The US dollar softened against the euro and yen Thursday on concerns over the US economic outlook. Analysts are now saying that the US economy appears to be losing momentum, and this slow-down has been weighing on the American currency against its counterparts; especially the euro and British pound.
The greenback declined vs. the Majors yesterday as a weaker-than-expected reading on new orders for US durable goods contributed more fears about the general economic outlook. Adding to the recent rise in risk aversion, the Federal Reserve has said that overall US economic activity is still increasing, but not as robustly as desired.
On the other hand, there is a chance that the US dollar may advance – after sliding 6.4% against the EUR this month – if the US economy shows signs of more modest growth. Several economists do not feel that the relative underperformance of American economic data will continue, and therefore we could see flows of investment back into the US, leading to dollar-appreciation.
Weekly jobless claims will again be a big event for the markets today, and market players may see the USD pare some of its previous losses and rise above the $1.2950 level if this report can beat forecasts.
American Federal Reserve nomination vote, US producer price index, US Unemployment Claims and Industrial Production are among the major market moving events. Here is an outlook on todays busy event schedule.
In the US, American Federal Reserve nomination vote will focus on the appointment of 3 FOMC members. The US Senate will vote on Sarah Bloom Raskin, Peter Diamond and Janet Yellen, in a vote that will shape future decisions for quite a while. If they arent approved, or if many questions are raised, the dollar could be hurt.
Later in the US, The producer price index in May fell 0.3 percent after dipping 0.1 percent in April. A drop of 0.2 percent is expected now. But at the core level, the PPI gained 0.2 percent in May, matching the rate in April. Another gain of 0.1% is expected now.
More in the US, Unemployment Claims forecasted another small drop to 453K after a surprising decrease to 454K last week. Further improvement below 430K will give a serious boost to the job market.
Industrial Production, the main gauge of industrial activity measuring the output of factories, mines and utilities is forecasted to slow down with industrial output flattening at 0.0% in June, compared with the 1.3% increase in May.
Empire State Manufacturing Index surveying 200 manufacturers is forecasted to reach 18.9 points following the drop from 31.9 to the level of 19 points in April and May however this is still a positive reading.
Capacity Utilization Rate measuring percentage of available resources being utilized by manufacturers, mines, and utilities expected to rise 0.1% to 74.2%.
Finally in the US, Philly Fed Manufacturing Index expected to rise to 11.4 points following a steep drop from 21.4 to 8 points in May.
In Canada, Manufacturing Sales predicted to advance 0.4% from 0.2% in May. Manufacturing sales have risen in 9 of the past 10 months and have been trending upward since the low reached in May 2009.
For more on USD/CAD, read the Canadian dollar forecast.
In Europe, European Central Bank Monthly Bulletin reveals the statistical data that the ECB Governing Board evaluated when making the latest interest rate decision, and provides detailed analysis of current and future economic conditions from the banks viewpoint.
For more on the Euro, read the EUR/USD forecast and Casey Stubbs latest analysis.
In Great Britain, David Miles an external member of the monetary policy committee of the bank of England speaks at the Business Forum in Bristol could determine a rise in interest rates.
Read more about the Pound in the GBP/USD forecast.
In Switzerland, The Swiss ZEW Expectations Survey came in significantly lower, with a 17.5 reading in June on Mays 40.5 reading. Expectations of economic contraction on the back of Euronation austerity measures are cited as cause. A further drop is expected.
In Australia, MI Inflation Expectations fell to 3.4% in the previous quarter from 3.6%. A drop under 3% will weaken the Aussie and New Motor Vehicle Sales predicted a small rise following the sharp drop from 9.0% to -3.0% in May.
For more on the Aussie, read the AUD/USD forecast.
In New Zealand, Consumer Price Index forecasted 0.5% rise in the second quarter following a disappointing 0.4% rise in Q1 when 0.6% was expected.
In Japan, Tertiary Industry Activity measuring change in the total value of services purchased by businesses is foreseen a 0.7% drop following the 2.1% rise in April.
Thats it for today. Happy forex trading!
In the US, American Federal Reserve nomination vote will focus on the appointment of 3 FOMC members. The US Senate will vote on Sarah Bloom Raskin, Peter Diamond and Janet Yellen, in a vote that will shape future decisions for quite a while. If they arent approved, or if many questions are raised, the dollar could be hurt.
Later in the US, The producer price index in May fell 0.3 percent after dipping 0.1 percent in April. A drop of 0.2 percent is expected now. But at the core level, the PPI gained 0.2 percent in May, matching the rate in April. Another gain of 0.1% is expected now.
More in the US, Unemployment Claims forecasted another small drop to 453K after a surprising decrease to 454K last week. Further improvement below 430K will give a serious boost to the job market.
Industrial Production, the main gauge of industrial activity measuring the output of factories, mines and utilities is forecasted to slow down with industrial output flattening at 0.0% in June, compared with the 1.3% increase in May.
Empire State Manufacturing Index surveying 200 manufacturers is forecasted to reach 18.9 points following the drop from 31.9 to the level of 19 points in April and May however this is still a positive reading.
Capacity Utilization Rate measuring percentage of available resources being utilized by manufacturers, mines, and utilities expected to rise 0.1% to 74.2%.
Finally in the US, Philly Fed Manufacturing Index expected to rise to 11.4 points following a steep drop from 21.4 to 8 points in May.
In Canada, Manufacturing Sales predicted to advance 0.4% from 0.2% in May. Manufacturing sales have risen in 9 of the past 10 months and have been trending upward since the low reached in May 2009.
For more on USD/CAD, read the Canadian dollar forecast.
In Europe, European Central Bank Monthly Bulletin reveals the statistical data that the ECB Governing Board evaluated when making the latest interest rate decision, and provides detailed analysis of current and future economic conditions from the banks viewpoint.
For more on the Euro, read the EUR/USD forecast and Casey Stubbs latest analysis.
In Great Britain, David Miles an external member of the monetary policy committee of the bank of England speaks at the Business Forum in Bristol could determine a rise in interest rates.
Read more about the Pound in the GBP/USD forecast.
In Switzerland, The Swiss ZEW Expectations Survey came in significantly lower, with a 17.5 reading in June on Mays 40.5 reading. Expectations of economic contraction on the back of Euronation austerity measures are cited as cause. A further drop is expected.
In Australia, MI Inflation Expectations fell to 3.4% in the previous quarter from 3.6%. A drop under 3% will weaken the Aussie and New Motor Vehicle Sales predicted a small rise following the sharp drop from 9.0% to -3.0% in May.
For more on the Aussie, read the AUD/USD forecast.
In New Zealand, Consumer Price Index forecasted 0.5% rise in the second quarter following a disappointing 0.4% rise in Q1 when 0.6% was expected.
In Japan, Tertiary Industry Activity measuring change in the total value of services purchased by businesses is foreseen a 0.7% drop following the 2.1% rise in April.
Thats it for today. Happy forex trading!
EURUSD Forecast:
The EURUSD had a significant bullish momentum yesterday, after three high impact US data (Unemployment Claims, ISM Manufacturing PMI, Pending Home Sales) showed bad results. On h4 chart below we can see that price is now convincingly move above 1.2465 key resistance area (now support) indicating not only potential nearest term bullishness but also could mark the beginning of a new medium bullish outlook. Nearest bullish target is seen at 1.2670. Only a movement back below 1.2465 could diminish the bullish momentum but overall we are still in a strong bullish correction. We will have US NFP data today, which is expected to be a bad one, forecast at -106K. Unless we see a big positive surprise from the forecast, the Euro should keep its bullish bias at this phase.
GBPUSD Forecast:
The GBPUSD slipped below the minor trendline support yesterday, but whipsawed to the upside, topped at 1.5189 and closed at 1.5175 after three high impact US data (Unemployment Claims, ISM Manufacturing PMI, Pending Home Sales) showed bad results. The bias is bullish in nearest term targeting 1.5400 1.5500 region especially if price able to move consistently above the trendline resistance (yellow). Immediate support at 1.5100. Break below that area could lead us into neutral zone in nearest term but as long as price stay above 1.5000 area the bullish bias should remain intact. We will have US NFP data today, which is expected to be a bad one, forecast at -106K. Unless we see a big positive surprise from the forecast, the Sterling should keep its bullish bias at this phase.
USDJPY Forecast:
The USDJPY attempted to push lower yesterday, bottomed at 86.97 but closed higher at 87.59 and keep moving higher around 87.81 at the time I wrote this comment. The bias is neutral in nearest term but still in a major bearish outlook. Immediate resistance at 88.23 (former support). Break above that area could trigger further bullish correction testing 88.75 89.00 region.
USDCHF Forecast
The USDCHF continued its bearish momentum yesterday, bottomed at 1.0577 and closed at 1.0589. Like I said yesterday, a after break below 1.0750 area, potential bearish target is now seen at 1.0500 region. Break below 1.0500 could trigger further bearish momentum testing 1.0220 area in longer term view. Immediate resistance at 1.0650/70 region. Break above that area could lead us into neutral zone testing 1.0750 area but the main scenario remains bearish at this phase.
Have a great day!
The EURUSD had a significant bullish momentum yesterday, after three high impact US data (Unemployment Claims, ISM Manufacturing PMI, Pending Home Sales) showed bad results. On h4 chart below we can see that price is now convincingly move above 1.2465 key resistance area (now support) indicating not only potential nearest term bullishness but also could mark the beginning of a new medium bullish outlook. Nearest bullish target is seen at 1.2670. Only a movement back below 1.2465 could diminish the bullish momentum but overall we are still in a strong bullish correction. We will have US NFP data today, which is expected to be a bad one, forecast at -106K. Unless we see a big positive surprise from the forecast, the Euro should keep its bullish bias at this phase.
GBPUSD Forecast:
The GBPUSD slipped below the minor trendline support yesterday, but whipsawed to the upside, topped at 1.5189 and closed at 1.5175 after three high impact US data (Unemployment Claims, ISM Manufacturing PMI, Pending Home Sales) showed bad results. The bias is bullish in nearest term targeting 1.5400 1.5500 region especially if price able to move consistently above the trendline resistance (yellow). Immediate support at 1.5100. Break below that area could lead us into neutral zone in nearest term but as long as price stay above 1.5000 area the bullish bias should remain intact. We will have US NFP data today, which is expected to be a bad one, forecast at -106K. Unless we see a big positive surprise from the forecast, the Sterling should keep its bullish bias at this phase.
USDJPY Forecast:
The USDJPY attempted to push lower yesterday, bottomed at 86.97 but closed higher at 87.59 and keep moving higher around 87.81 at the time I wrote this comment. The bias is neutral in nearest term but still in a major bearish outlook. Immediate resistance at 88.23 (former support). Break above that area could trigger further bullish correction testing 88.75 89.00 region.
USDCHF Forecast
The USDCHF continued its bearish momentum yesterday, bottomed at 1.0577 and closed at 1.0589. Like I said yesterday, a after break below 1.0750 area, potential bearish target is now seen at 1.0500 region. Break below 1.0500 could trigger further bearish momentum testing 1.0220 area in longer term view. Immediate resistance at 1.0650/70 region. Break above that area could lead us into neutral zone testing 1.0750 area but the main scenario remains bearish at this phase.
Have a great day!
Biggest % gainers: EUR/AUD up 1.33%, EUR/TRY, EUR/USD up 1.25%, EUR/NZD up 1.17% on EUR strength.
Biggest % losers: AUD/JPY down 0.93%, USD/CHF, USD/JPY, NZD/JPY, AUD/CAD, CAD/JPY on USD weakness & JPY strength.
USD/JPY hits fresh 2010 lows (not 52 week low). The pair is at 87.74 right now.
ADP was lower yesterday....Weekly Unemployment Claims were lower today...hmmmm, wonder what that says about NFP on Friday? Get ready for a bumpy economic road ahead!
The European Central Bank announced that it lent banks 111.2 billion euros for six days in order to help them cope with the expiry of its landmark 12-month loans today.
DailyFX - ECB Lends $136.5 Billion for Six Days to Cope12 Month Loans Due Today, German Retail Sales Advance in May http://www.dailyfx.com/forex/fundame...#ixzz0sRFOxGw2
Gold $1,235
Oil $74.49
GBP Manufacturing PMI basically in line at 57.5 vs. 57.6 expected (58.0 was last time).
CAD Bank Holiday today.
USD Unemployment Claims worse at 472k vs. 454k expected and 459k last time.
USD ISM Manufacturing PMI comes out at 10am EST. 58.9 is the expectation.
USD Pending Home Sales m/m come out at 10am EST today. Expectation is for -7.4%. Last time was +6.0%.
CHF SNB is "rumored" to be supporting the EUR/CHF around 1.3200ish now.
Sean Hyman
DailyFX Forum Moderator
Biggest % losers: AUD/JPY down 0.93%, USD/CHF, USD/JPY, NZD/JPY, AUD/CAD, CAD/JPY on USD weakness & JPY strength.
USD/JPY hits fresh 2010 lows (not 52 week low). The pair is at 87.74 right now.
ADP was lower yesterday....Weekly Unemployment Claims were lower today...hmmmm, wonder what that says about NFP on Friday? Get ready for a bumpy economic road ahead!
The European Central Bank announced that it lent banks 111.2 billion euros for six days in order to help them cope with the expiry of its landmark 12-month loans today.
DailyFX - ECB Lends $136.5 Billion for Six Days to Cope12 Month Loans Due Today, German Retail Sales Advance in May http://www.dailyfx.com/forex/fundame...#ixzz0sRFOxGw2
Gold $1,235
Oil $74.49
GBP Manufacturing PMI basically in line at 57.5 vs. 57.6 expected (58.0 was last time).
CAD Bank Holiday today.
USD Unemployment Claims worse at 472k vs. 454k expected and 459k last time.
USD ISM Manufacturing PMI comes out at 10am EST. 58.9 is the expectation.
USD Pending Home Sales m/m come out at 10am EST today. Expectation is for -7.4%. Last time was +6.0%.
CHF SNB is "rumored" to be supporting the EUR/CHF around 1.3200ish now.
Sean Hyman
DailyFX Forum Moderator
Filed under Latest FX Articles · Tagged with biggest gainers, DailyFX, ism manufacturing, unemployment claims, USD JPY
US Core Durable Goods Orders and US Unemployment Claims are the highlight of the day. Lets review todays activities:
In the US, The Core Durable Goods Orders measures the change in the total value of new orders for durable goods, excluding transportation appears to have considerable impact on the currency market expecting a rise of 2.2% from -1.1% in May while the less influential Durable Goods Orders is foreseen 3.8% drop from 2.8% in May.
More in the US, Unemployment Claims expected to go down by 11,000 following the unforeseen rise last week.
Finally in the US, Natural Gas Storage expected a drop 7B this week reaching 80B.
For more on USD/CAD, read the Canadian dollar forecast.
In Europe, French Consumer Spending believed to climb 1.5% from -1.2% in May. It seems like things start to brighten up for French consumers.
More in Europe, Industrial New Orders expected to drop to 1.6% from the 5.7% jump in the previous month.
Finally in Europe, Italian Retail Sales expected to decline by 0.6% reaching -0.1% and Italian Quarterly Unemployment Rate also support the retail sales decline by an increase forecast of 0.4%.
For more on the Euro, read the EUR/USD forecast and Casey Stubbs latest analysis.
In Australia, CB Leading Index foreseen to remain 0.3% following the improvement in May.
For more on the Aussie, read the AUD/USD forecast.
In New Zealand, Trade Balance surplus continues to climb by 154B, reaching a fantastic figure of 810M which is great for market activity.
In Japan, Tokyo Core CPI expected to go up by 0.1% to -1.5% which correlates with the anticipated rise of 0.2% in the National Core CPI.
Thats it for today. Happy forex trading!
In the US, The Core Durable Goods Orders measures the change in the total value of new orders for durable goods, excluding transportation appears to have considerable impact on the currency market expecting a rise of 2.2% from -1.1% in May while the less influential Durable Goods Orders is foreseen 3.8% drop from 2.8% in May.
More in the US, Unemployment Claims expected to go down by 11,000 following the unforeseen rise last week.
Finally in the US, Natural Gas Storage expected a drop 7B this week reaching 80B.
For more on USD/CAD, read the Canadian dollar forecast.
In Europe, French Consumer Spending believed to climb 1.5% from -1.2% in May. It seems like things start to brighten up for French consumers.
More in Europe, Industrial New Orders expected to drop to 1.6% from the 5.7% jump in the previous month.
Finally in Europe, Italian Retail Sales expected to decline by 0.6% reaching -0.1% and Italian Quarterly Unemployment Rate also support the retail sales decline by an increase forecast of 0.4%.
For more on the Euro, read the EUR/USD forecast and Casey Stubbs latest analysis.
In Australia, CB Leading Index foreseen to remain 0.3% following the improvement in May.
For more on the Aussie, read the AUD/USD forecast.
In New Zealand, Trade Balance surplus continues to climb by 154B, reaching a fantastic figure of 810M which is great for market activity.
In Japan, Tokyo Core CPI expected to go up by 0.1% to -1.5% which correlates with the anticipated rise of 0.2% in the National Core CPI.
Thats it for today. Happy forex trading!
Filed under Latest FX Articles · Tagged with core cpi, durable goods orders, french consumers, natural gas storage, unemployment claims
