July 24: Asian session
EUR/USD is trading on the downside, just above $1.3200 after reaching $1.3280 yesterday. US dollar was weaker yesterday as lower US economic indicators bolstered the argument for the Fed to delay a reduction in QE. Euro was supported before data predicted to show services and factory output in the euro area contracted at the slowest pace in more than a year. Watch the releases at 07:00-08:00 GMT. GBP/USD is capped by the bottom of the daily Ichimoku Cloud at $1.5380.
Chinese HSBC flash manufacturing PMI disappointed the Asian markets, coming below the forecast at 47.7 and hitting at 11-month low (forecast: 48.6, previous: 48.2). AUD/USD dropped from $0.9320 to $0.9240. Australia Q2 CPI came unchanged at +0.4% q/q (vs. expected +0.5%), while the core reading came a bit above the forecast. NZD/USD fell from the high of $0.8010 to $0.7950. New Zealand June trade balance improved to $414M (vs. $105M expected). Tonight RBNZ holds its monthly monetary policy meeting.
USD/JPY strengthened by 40 pips to 99.90. Japan trade deficit for June rose to 180.8B yen (vs. expected is 155.7B). USD/CHF strengthened to 0.9360. USD/CAD recovered from 1-month low at 1.0280 to 1.0300. Canadian dollar strengthened yesterday after a report showed retail sales in May increased at the fastest pace in 3 years, fueling speculation the economy may be improving.