Currency Analyst since 2010

August 16: Asian session

On Thursday trading was quite volatile. The greenback initially strengthened on positive US data like lower unemployment claims, but then sharply weakened as the next bunch of figures (industrial production, New York and Philadelphia manufacturing indexes) came lower than expected. Today US dollar recovered a bit before reports forecast to show housing starts rebounded and consumer confidence increased to a 6-year high (12:30 GMT).

EUR/USD tested $1.3205 yesterday before jumping to $1.3362. The pair’s trading in the $1.3340 area at the moment of writing. The euro area will release inflation data today at 09:00 GMT which may show inflation is contained. In addition, reports due next week may indicate a pickup manufacturing and services expansion. GBP/USD jumped yesterday by about 140 pips to $1.5650. Today pound’s correcting to the $1.5600 area. USD/JPY recovered from a three-day low at 97.05 to 97.75. USD/CHF edged slightly higher to 0.9275 after the yesterday’s sharp dollar selloff.

AUD/USD slipped to $0.9150 after a test of $0.9180 earlier in Asia. NZD/USD dropped briefly below $0.8060 as Wellington in New Zealand was hit by a series of earthquakes. The New Zealand Stock has re-opened after temporarily closure. USD/CAD slid to levels just above 1.0300 yesterday and is correcting a bit up today. Watch Canadian retail sales at 12:30 GMT.

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