Daily Market Outlook by Kate Curtis from Trader's Way

[katetrades]

Forex Major Currencies Outlook (Feb 09, 2018)

USD

The US dollar was able to take advantage of risk-off flows as stock markets tanked once more. Equity indices were down roughly 4% mostly due to the short volatility trade, another pending government shutdown, and global tightening prospects. US data was stronger than expected as the initial jobless claims figure improved from 230K to 221K versus the 232K forecast.

EUR

Data from the euro zone was weaker than expected as Germany printed a smaller trade surplus of 21.4 billion EUR versus the earlier 22.3 billion EUR figure and the projected 21.5 billion EUR surplus. Today has French and Italian industrial production numbers on tap and strong data could keep ECB hike expectations in play.

GBP

The pound got a strong boost from a hawkish BOE statement as the committee expressed their intention to tighten at a faster pace than initially expected. The BOE also upgraded growth and inflation forecasts, underscoring their hiking bias. UK manufacturing and industrial production numbers are due next. The former could show a 0.3% uptick while the latter might see a 0.9% decline.

CHF

The franc was the king of pips as it raked in safe-haven gains more than the dollar and yen. There were no reports out of the Swiss economy yesterday while today has the unemployment rate. Analysts are expecting to see no change from the 3.0% reading.

JPY

The yen was also in the top spot due to risk-off flows stemming from the stock market selloff. Data from Japan was actually weaker than expected as the Economy Watchers Sentiment index fell from 53.9 to 49.9 versus the 53.7 consensus. The tertiary index is due next and analysts expect to see a 0.2% uptick. Market sentiment is likely to keep pushing yen pairs around today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were in a weak spot because of the risk-off moves in the financial markets. The Aussie was strongest hit due to RBA head Lowe's remarks and weak data in the earlier session. Today Australia reported a 2.3% drop in home loans while Chinese inflation reports came in line with expectations of a dip in price levels. Canada's jobs reports are lined up next, with the employment change figure expected to post a 10.3K gain.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 12, 2018)

USD

The US dollar held its ground on Friday despite the lack of top-tier data. However, the spending bill just recently signed prevented another shutdown from taking place, leading to a bit of reprieve for bulls. Only the federal budget balance is due today, so market sentiment could play a stronger role in pushing the currency around.

EUR

The euro gave up some ground on Friday despite seeing stronger than expected figures. French industrial production rose 0.5% versus the estimated 0.1% uptick while Italian industrial production was up 1.6% versus the 0.7% consensus. There are no major reports due from the euro zone today.

GBP

The pound struggled to hold on to its gains despite the hawkish BOE Super Thursday earlier last week. Weaker than expected industrial production data was blamed for the drop, as the reading showed a 1.6% fall versus the estimated 0.9% drop. Manufacturing production came in line with estimates of a 0.3% uptick while the goods trade balance printed a wider than expected deficit. MPC members Vlieghe and McCafferty have speeches today.

CHF

The franc gave up some gains on Friday due to profit-taking and a slight improvement in risk appetite. The Swiss jobless rate was unchanged at 3.0% as expected. Swiss CPI is due today and a 0.1% dip in price levels is eyed after the earlier flat reading. A larger than expected fall could put the blame on franc strength, which might then revive intervention fears.

JPY

The yen also returned some gains as traders booked profits at the end of the week. Yen pairs gapped higher as risk appetite was off to a strong start this week. Japanese banks are closed for the holiday, so yen pairs could be more sensitive to currency-specific flows.

Commodity Currencies (AUD, NZD, CAD)

The comdolls made a bit of a bounce as risk appetite returned on Friday. Canada's jobs figures were in the red as the employment change showed an 88K decline while the unemployment rate rose from 5.7% to 5.9% versus the 5.9% consensus. Components of the report revealed that the drop was mostly due to a large reduction in part-time hiring while full-time employment was actually 49K higher. There are no reports due from the comdoll economies today.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 13, 2018)

USD

The US dollar was off to a weak start on Monday as risk-taking took hold and traders flocked to stocks and commodities. The mood was positive after the Trump administration released their infrastructure spending plans. There are no major reports due from the US today but FOMC member Mester has a speech due.

EUR

The euro was weaker on more signs of trouble in German coalition talks. There were no reports to prop up the shared currency then while today has French private payrolls on tap. Analysts are expecting to see a 0.2% uptick for the quarter, although this might not have much of an impact on euro behavior.

GBP

The pound barely drew support from another round of mostly hawkish remarks from BOE officials, even as McCafferty reiterated that further hikes are needed. He did say that they need to get rates up to a level where they can cut later on if needed, though. UK CPI readings are due today and a dip in the annual headline figure from 3.0% to 2.9% is eyed. The core reading could advance from 2.5% to 2.6%.

CHF

The franc was mostly stuck in consolidation as a bit of risk appetite returned to the financial markets. Swiss CPI came in line with estimates of a 0.1% dip and PPI data is due today. Another 0.2% uptick is expected.

JPY

The yen was also in a weak spot like the dollar as safe-havens lagged behind. The announcement that BOJ head Kuroda would likely be appointed for another full five-year term also kept easing expectations in place. PPI dipped from 3.0% to 2.7% and preliminary machine tool orders data is due next.

Commodity Currencies (AUD, NZD, CAD)

The Aussie and Kiwi took advantage of risk-on flows while the Loonie lagged despite a bounce in crude oil. Australia's NAB business confidence index rose from a downgraded reading of 10 to 12 to reflect a bit more optimism. There are no major reports due from the comdolls next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 14, 2018)

USD

The US dollar was still in the loser's end during the latest trading sessions as risk appetite was present. There were also no major reports to prop the US dollar higher while traders price in expectations for weaker inflation data. Headline CPI is expected to rise by 0.3% versus the earlier 0.1% uptick, though, while the core reading could dip from 0.3% to 0.2%. Retail sales figures are also up for release.

EUR

The euro was one of the top performers of the day, despite the lack of any major data. Today has German and Italian preliminary GDP figures due early in the London session before the region's flash GDP reading is printed. Analysts are expecting to see another 0.6% expansion, but a stronger than expected read could boost ECB tightening expectations.

GBP

The pound drew support from upbeat CPI data, with the headline reading holding steady at 3.0% instead of dipping to 2.9% and the core figure up from 2.5% to 2.7% versus the 2.6% consensus. Only the CB leading index is due from the UK today and another decline could mean pound weakness.

CHF

The franc had a mixed run as it reacted mostly to currency-specific data. Swiss PPI beat expectations with a 0.3% gain versus the estimated 0.2% uptick. There are no reports due from Switzerland today but SNB Governing Board member Zurbrugg has a speech lined up.

JPY

The yen was also a strong performer as it took advantage of dollar weakness when risk-off flows returned. The preliminary GDP reading printed a weaker than expected 0.1% expansion for Q4 2017 but the earlier figure was upgraded to 0.6% growth. There are no other reports lined up from Japan so market sentiment could push yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their wins to the yen but held their ground versus the dollar. The Loonie lagged for another day, however, as crude oil looked ready to resume its drop. New Zealand's quarterly inflation expectations rose from 2.0% to 2.1%.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 15, 2018)

USD

The US dollar chalked up another losing day as traders favored the higher-yielding currencies. Although CPI data surprised to the upside, the focus was on weaker retail sales data. Headline retail sales slipped 0.3% versus the estimated 0.2% gain while the core reading was flat. Medium-tier reports such as PPI, Empire State manufacturing index, and Philly Fed index are due today.

EUR

The euro had a mixed performance as data also turned out mixed. German preliminary GDP came in line with estimates of a 0.6% expansion while the region's industrial production was stronger than expected at 0.4% versus 0.1%. Only the region's trade balance is lined up today.

GBP

The pound advanced to the dollar but weakened to the yen as there were no major reports providing a clear direction in the latest London session. There are still no major reports lined up today, as the next top-tier release is the UK retail sales on Friday.

CHF

The franc took a break from its rallies as risk-taking was in play in recent sessions. SNB member Zurbrugg gave a couple of speeches during the UK session but didn't really spark a big move for the currency. There are no reports due from Switzerland today.

JPY

The yen was one of the strongest performers as it took advantage of dollar weakness and some risk-off flows. Only the revised industrial production report is due today and no changes from the 2.7% reading are eyed. Apart from that, sentiment and dollar action could push yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The Loonie caught a bid thanks to a smaller than expected build of 1.8 million barrels in EIA stockpiles versus the estimated 2.8 million gain. The Aussie and Kiwi continued their ascent, with the former shrugging off weaker than expected underlying jobs data. Headline employment change was at 16K versus the estimated 15.3K increase. Chinese banks are closed for the holiday today.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 16, 2018)

USD

The dollar had another day in the red as equities advanced but traders remained wary of fiscal risks. Data turned out mixed but positive PPI readings failed to draw support for the currency. The Empire State manufacturing index posted a downside surprise while the Philly Fed index jumped. Industry production and capacity utilization also missed estimates. Building permits and housing starts, along with import prices and UoM consumer expectations data, are due next.

EUR

The euro had a mixed round as it advanced to the dollar and Loonie but gave up ground to most of its other rivals. Low-tier data from the region was mostly stronger than expected, keeping tightening expectations in play, but traders are careful of potential jawboning in case currency appreciation starts hurting inflation. Only the German WPI is lined up today.

GBP

The pound was one of the top performers in recent sessions, although there were no major catalysts. BOE tightening expectations stemming from upbeat CPI data may still be in play. UK retail sales data is due next and a 0.5% rebound is eyed.

CHF

The franc gave up some ground on risk-taking but remained supported versus the dollar. There were no reports out of the Swiss economy then and none are due today so sentiment and currency-specific factors could push franc pairs around.

JPY

The yen scored another set of wins as it took most of the anti-dollar flows. Data from Japan also turned out stronger than expected as the industrial production figure was upgraded from 2.7% to 2.9%. There are no reports lined up today so sentiment could be the main driver.

Commodity Currencies (AUD, NZD, CAD)

The comdolls managed to hold their ground as risk-taking carried on and commodities drew support. Australia's headline jobs data turned out slightly better than expected but this was mostly due to part-time hiring. Canadian foreign securities purchases and manufacturing sales are lined up next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (February 19, 2018)

USD

The US dollar was able to rebound against most of its peers on Friday as profit-taking happened before the long weekend. US banks are closed in observance of President's Day today, which means that liquidity is low and volatility could tick higher. This could also give equities reason to pause from their rallies.

EUR

The euro was still in a weak spot despite mostly upbeat low-tier data. German WPI beat expectations with a 0.9% gain versus the estimated 0.2% uptick. Only the current account balance is due today, leaving traders to price in expectations for the ECB minutes due later on.

GBP

The pound gave up some ground on Friday due to weak retail sales data. Consumer spending was expected to have increased by 0.5% in January but only rose 0.1%. Still, the previous reading enjoyed a small upgrade. BOE Governor Carney has a speech today.

CHF

The franc continued to rake in gains on Friday even though there were no major reports from the Swiss economy. There are still no major reports due from the Swiss economy today so market sentiment and currency-specific factors could stay in play.

JPY

The yen held on to its top spot for the most part of the week as dollar demand ticked lower. Over the weekend, Japan printed a stronger than expected trade balance of 0.37 trillion JPY. There are no other reports due from Japan today but the bank holiday in the US could bring more traders to the yen.

Commodity Currencies (AUD, NZD, CAD)

The comdolls had a mixed run as they gave up some ground to the dollar on Friday. Canadian manufacturing sales and foreign securities purchases turned out weaker than expected while New Zealand has its quarterly PPI numbers due next. Input prices could rise 0.3% while output prices could increase by 0.4%.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (February 20, 2018)

USD

The dollar was able to pocket a few gains even as US markets were closed for the President's Day holiday. Markets will reopen today and another round of risk-taking could prompt weakness for the safe-haven currency. There are no major reports from the US today, so sentiment could be a main mover.

EUR

The euro was mostly weaker due to a lower than expected current account surplus. There were no other reports released from the region, leaving traders to price in expectations for the ECB minutes due later in the week. Today has German PPI and the ZEW economic sentiment figures lined up.

GBP

The pound also gave up ground to most of its peers when Brexit concerns resurfaced in the headlines. PM May's spokesperson said that ministers are setting plans for the post-Brexit EU deal, which reminded market watchers that a plan isn't actually set in stone yet. BOE Governor Carney's speech contained no surprises and the CBI industrial order expectations index is due next.

CHF

The franc slid lower to the yen and dollar but managed to hold its ground against the commodity currencies. There were no reports out of the Swiss economy then while today has the trade balance due. A larger surplus of 2.78 billion CHF is eyed compared to the earlier 2.63 billion CHF figure.

JPY

The yen gave back some of its previous gains as traders continued to book profits after last week's rallies. There were no reports out of Japan then and none are due today, which means that risk sentiment could be the prime mover of yen pairs.

Commodity Currencies (AUD, NZD, CAD)

New Zealand printed stronger than expected quarterly PPI figures, keeping bulls hopeful that the RBNZ could shift its policy stance sooner rather than later. Still, PPI readings were slightly weaker compared to the previous quarter. The RBA minutes were released and it revealed that the central bank was slightly more optimistic about the consumer sector. Canadian wholesale sales and New Zealand's GDT auction are lined up next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (February 21, 2018)

USD

The dollar was able to score another winning day thanks to higher yields during the debt auction. A bit of risk aversion was also present as commodities and stocks closed in the red. Flash manufacturing and services PMI are due from the US today, but the attention could be on the FOMC minutes.

EUR

The euro gave up some ground to most of its peers as confidence in the region ticked down. The German ZEW economic sentiment index fell from 20.4 to 17.8 versus the estimated drop to 16.0 while the region's index dipped from 31.8 to 29.3 versus the estimated 28.4 figure. PMI readings from the manufacturing and services sectors of Germany and France are due. Small dips are eyed as well, which could bring the region's overall readings down.

GBP

The pound was able to stay mostly resilient despite resurfacing Brexit concerns. MPs have drafted a letter to PM May to set their requirements for a post-Brexit deal with the EU. UK CBI industrial order expectations fell from 14 to 10 versus the consensus at 12. UK jobs data is due today and a smaller increase in claimants is eyed. No change in the average earnings index of 2.5% is expected.

CHF

The franc gave up a bit of ground to its peers as risk-taking was present during the London session. The Swiss trade balance was also smaller than expected at a surplus of 2.09 billion CHF. There are no reports due from the Swiss economy today so sentiment could push franc pairs around.

JPY

The yen managed to trim its losses even though the dollar regained safe-haven appeal. There were no reports out of Japan yesterday while today has the flash manufacturing PMI and all industries activity index. Still, yen pairs could take their cue from dollar action, especially when the FOMC minutes are released.

Commodity Currencies (AUD, NZD, CAD)

The comdolls chalked up losses to the dollar as risk aversion was present in the markets. Canada reported weaker wholesale sales while New Zealand's GDT auction yielded a 0.5% dip in dairy prices. Meanwhile, data from Australia was mixed but saw more upside surprises. Construction work done for the previous quarter sank 19.4% versus the estimated 9.8% drop while the MI leading index fell 0.2%. On the flip side, the wage price index grew by 0.6% versus the estimated 0.5% uptick.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 23, 2018)

USD

The US dollar lost ground to its peers as risk appetite appeared to return to the markets. Bond yields ticked lower while equities and commodities chalked up gains, leaving the safe-haven currency to decline. Up ahead, FOMC members Dudley, Williams, and Mester have testimonies scheduled so their monetary policy remarks could determine where the dollar might be headed next.

EUR

Euro zone economic data turned out weaker than expected in the previous London session as the German IFO business climate index fell from 117.6 to 115.4. The ECB meeting minutes contained a few hawkish remarks but the central bank's hesitation to commit to a tightening plan has led to some euro weakness. Euro zone final CPI readings are lined up today.

GBP

The pound managed to hold its ground despite weaker than expected UK data. The Q4 GDP estimate was revised down from 0.5% to 0.4% instead of being kept unchanged as expected while the CBI realized sales index fell from 12 to 8 versus the estimated rise to 13. There are no reports due from the UK today but BOE MPC member Ramsden has a speech due.

CHF

The franc was also able to rake in some gains as it took advantage of dollar weakness to score some risk-off flows. There were no reports out of the Swiss economy yesterday and none are due today so market sentiment could remain the biggest driver.

JPY

The yen was a big winner as dollar weakness led risk averse traders to the lower-yielding yen.There were no major reports out of Japan then while the national core CPI was released earlier today. A stronger than expected 0.9% gain was reported versus the 0.8% consensus.

Commodity Currencies (AUD, NZD, CAD)

The Loonie suffered a sharp drop upon seeing Canada's retail sales report, as the headline figure fell 0.8% in December while the core reading showed a 1.8% slump. New Zealand, on the other hand, posted stronger than expected quarterly spending data. Headline retail sales rose 1.7% while the core reading had a 1.8% gain. Canada's CPI readings are due next and more disappointments could spur another leg lower for the Loonie.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 26, 2018)

USD

The dollar managed to stay supported throughout the previous week as Fed tightening expectations strengthened while risk aversion lingered in the markets. There were no reports out of the US economy on Friday but Fed officials had a few more positive remarks on the US economy. There are no major reports due today, with only FOMC member Quarles' testimony due.

EUR

The euro returned some of its recent gains before the week came to a close as final CPI readings were unchanged at 1.3% for the headline figure and 1.0% for the core version. There are no reports due from the euro zone today but ECB head Draghi has a speech scheduled and any jawboning remarks could lead to more euro weakness.

GBP

The pound managed to hold its ground, except against the Loonie, even though there were no major UK reports out on Friday. MPC member Ramsden had a speech in which he talked about the economy's productivity growth challenge. Only the High Street lending report is due from the UK today and this might not lead to huge pound moves.

CHF

The franc had a mixed run as it reacted mostly to currency-specific factors. There were no reports out of the Swiss economy then and none are due today, so market sentiment could push franc pairs around.

JPY

The yen gapped down over the weekend as market watchers are bracing for BOJ head Kuroda's testimony. There are no other major reports due from Japan, leaving yen pairs to react to overall sentiment as well.

Commodity Currencies (AUD, NZD, CAD)

The Loonie had a strong run thanks to stronger than expected Canadian CPI. The headline figure turned out better than expected at 0.7% versus the 0.4% estimate, reviving talks of a BOC hike. Other underlying inflation measures also reflected a stronger pace of increase in price levels also. New Zealand's trade balance is due in the next Asian session.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 27, 2018)

USD

The US dollar was in a weak spot as equities started the week on a positive note and traders seem wary of a cautious tone from new Fed Chair Powell's testimony. US new home sales also came in weaker than expected with a surprise fall. CB consumer confidence and US durable goods orders data are also due today.

EUR

The euro managed to score some gains when ECB head Draghi offered a few more optimistic remarks on the economy. He acknowledged that euro zone growth has been robust and that the labor market could see more improvements. However, he also warned that financial market volatility and currency movements warrant close monitoring. Flash CPI readings from Germany and Spain are due today and gains are eyed.

GBP

The pound was able to catch a bid as leaders continued to talk about a potential trade agreement with the EU even after Brexit. UK Labour leader Corbyn said that the government wants to negotiate a new customs union that could preserve a tariff-free arrangement. There are no reports due from the UK today so the focus could stay on Brexit headlines.

CHF

The franc gave up a bit of ground as risk appetite was in play. There were no reports out of the Swiss economy then and none are due today, which suggests that the franc could take its cue from sentiment or euro movements.

JPY

The yen gapped down over the weekend as market watchers are bracing for BOJ head Kuroda's testimony. There are no other major reports due from Japan, leaving yen pairs to react to overall sentiment as well.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was one of the weaker performers as falling crude oil and NAFTA jitters weighed on the currency. Word is that Mexico's President Nieto called off a visit to the US after a phone call in which Trump refused to announce that Mexico won't have to foot the bill for the border wall. New Zealand reported a trade deficit of 566 million NZD after the earlier 596 million NZD surplus, but this was still better compared to the estimated 2.71B NZD deficit.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Feb 28, 2018)

USD

Economic data from the US was mostly weaker than expected yesterday as durable goods orders data and the goods trade balance fell short of estimates. However, the dollar got a boost when new Fed Chairperson Powell gave his testimony and added a few more hawkish remarks that supported tightening expectations. Powell mentioned that he doesn't want to prejudge potential rate changes but listed more factors that tilt the risks to the upside. The preliminary GDP is up for release and analysts are expecting a downgrade from 2.6% to 2.5%.

EUR

The pound took some hits even though there were no major reports out of the UK. Moody's Brexit Monitor shared a gloomy outlook for the UK, citing “Consumer indicators are below five-year averages and household consumption growth has slowed since the Brexit referendum in June 2016. Lacklustre retail sales fell further below their five-year trend in January." There are no major reports due from the UK today.

GBP

The pound took some hits even though there were no major reports out of the UK. Moody's Brexit Monitor shared a gloomy outlook for the UK, citing “Consumer indicators are below five-year averages and household consumption growth has slowed since the Brexit referendum in June 2016. Lacklustre retail sales fell further below their five-year trend in January." There are no major reports due from the UK today.

CHF

The franc raked in more gains as risk aversion returned to the markets on stronger tightening prospects. There were no reports out of the Swiss economy then while today has the KOF economic barometer due. A dip from 102.9 to 102.6 is eyed. The UBS consumption indicator is also up for release.

JPY

The yen also chalked up some gains as global tightening prospects heated up on hawkish ECB and Fed remarks. However, data from Japan came in weaker than expected earlier today, with the preliminary industrial production and retail sales both falling short. There are no other reports due from Japan, which suggests that sentiment could take over yen price action.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were the weakest in the bunch as risk appetite returned to the financial markets. Apart from global tightening expectations, weaker PMI readings from China also dampened demand for commodity currencies. The official manufacturing PMI fell from 51.3 to 50.3 versus 51.2 while the non-manufacturing PMI slid from 55.3 to 54.4. EIA crude oil inventories data is due today.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 1, 2018)

USD

The US dollar was able to take advantage of risk-off flows despite weaker than expected US data. Chicago PMI and pending home sales both disappointed while the preliminary GDP was downgraded from 2.6% to 2.5% in Q4 2017 as expected. US core PCE price index is due today and a 0.3% uptick is eyed, slightly stronger than the earlier 0.2% increase. Personal spending and income numbers are also lined up, along with the ISM manufacturing PMI, which is expected to dip from 59.1 to 58.7.

EUR

The euro was in a weak spot as resurfacing Brexit concerns also weighed on the shared currency. Flash CPI estimates came in line with expectations of 1.2% for the headline figure and 1.0% for the core figure. Final manufacturing PMI readings from the top euro zone economies are due today.

GBP

The pound was one of the biggest losers for the day when the EU released its draft withdrawal agreement that specified a common regulatory area with Northern Ireland. This is a key point of contention for several UK officials, which suggests that tensions could flare again. There were no major reports from the UK then, which explains the extra focus on Brexit-related updates. UK manufacturing PMI is due today and a dip from 55.3 to 55.1 is expected.

CHF

The franc was also able to take advantage of risk-off flows in recent sessions, especially since other European currencies were on weak footing. Swiss data was also mostly stronger than expected, with the KOF economic barometer up from an upgraded 107.6 reading to 108.0. However, the Credit Suisse economic expectations index fell from 34.5 to 25.8. Swiss GDP, retail sales, and the UBS consumption indicator are due today.

JPY

The yen was the biggest winner for the day as it also managed to outpace the safe-haven dollar. Japanese data actually came in below expectations in yesterday's Asian session but today's set was in the green. Capital spending is up 4.3% versus 3.1% for the latest quarter, also a notch higher than the earlier 4.2% gain. Consumer confidence index and the bond auction are scheduled next.

Commodity Currencies (AUD, NZD, CAD)

The comdolls gave up ground across the board as traders dumped higher-yielding currencies. The Aussie was actually in a good spot earlier on but soon gave up ground on risk aversion. The Loonie was also hit by weaker oil prices after the EIA reported a larger than expected build in stockpiles. Australia's private capital expenditure disappointed with a 0.2% drop versus the estimated 1.0% gain.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 2, 2018)

USD

The US dollar took hits against most of its counterparts when Trump announced his plans to impose higher tariffs on steel and aluminium as this sparked trade war fears. Data from the US was mostly better than expected, though, with the ISM manufacturing PMI up from 59.1 to 60.8 versus the 58.7 forecast so the dollar still managed to hold its ground against commodity currencies. Only revised UoM consumer sentiment data is lined up today.

EUR

The euro had a mixed round as it gave up ground to the lower-yielders but advanced against commodity currencies and the pound. Data came in mixed, with Italian manufacturing PMI and monthly unemployment rate coming in weaker than expected. German retail sales, import prices, and Spanish unemployment change data are due next.

GBP

The pound carried on with its slide as more traders tuned in to the EU draft agreement headlines and are waiting to hear what PM May has to say about it. UK manufacturing PMI fell from 55.3 to 55.2 but was better than the projected fall to 55.1. Construction PMI is due next but May's speech would likely take the spotlight.

CHF

The franc took advantage of risk-off flows and weakness in its European rivals. Swiss manufacturing PMI also beat expectations by rising from 65.3 to 65.5 versus the estimate at 64.1. There are no reports due from the Swiss economy today so sentiment could be the major driver.

JPY

The yen regained ground to the dollar as fears of a US trade war returned and risk aversion was in full swing. Data from Japan was actually weaker than expected as the consumer confidence index fell from 44.7 to 44.3 versus the estimated improvement to 44.9. Earlier today, it was reported that the jobless rate improved from 2.8% to 2.4%.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were hardest hit by trade war fears on Trump's announcement, particularly the Loonie which is still reeling from NAFTA talks. Canada's current account balance beat expectations but its Markit PMI was a miss. The monthly GDP reading is due next and a meager 0.1% growth figure is eyed.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 5, 2018)

USD

The US dollar gave up some ground to its peers on Friday as trade war fears escalated, but it managed to hold on to its gains versus the commodity currencies. The UoM consumer sentiment index was downgraded from 99.9 to 99.7 but still slightly better than the 99.4 consensus. The ISM non-manufacturing PMI is due today and a fall from 59.9 to 58.9 is eyed, with traders likely to pay closer attention to the jobs component.

EUR

The euro struggled to hold its ground versus the yen but managed to advance against the dollar and commodity currencies. Data was mixed, with German retail sales down 0.7% versus the estimated 0.8% uptick and import prices beating expectations with a 0.5% gain. Final services PMI readings from its top economies, along with the region's retail sales figure, are lined up today.

GBP

The pound was the weakest of the bunch as resurfacing Brexit concerns weighed on business sentiment and the currency. This has been the case since the EU draft agreement was released, and PM May's speech hinted of more roadblocks ahead. The construction PMI beat expectations and the services sector will release their PMI today. Analysts expect a gain from 53.0 to 53.3.

CHF

The franc took advantage of risk-off flows as it rallied across the board. There were no reports out of the Swiss economy then and none are due today, so market sentiment could push franc pairs around.

JPY

The yen was also a big winner in recent trading sessions, owing to risk aversion and dollar weakness. There were no reports from Japan then and none are due today, which suggests that global bond yields and dollar demand could be a factor in yen price action.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were mostly weaker as risk aversion on trade war jitters took hold. Recall that Trump plans to impose higher tariffs on steel and aluminum imports to the US to protect producers, thereby limiting demand for these raw materials. Canada's GDP came in line with estimates of a meager 0.1% uptick. Australia's building approvals and company operating profits beat expectations.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 6, 2018)

USD

The US dollar regained some ground to its peers but caved to the Aussie and Kiwi when risk appetite returned in the US session. Economic data was better than expected as the ISM non-manufacturing PMI fell from 59.9 to 59.5 versus the estimated tumble to 58.9. However, it's worth noting that the prices and employment components posted steep declines. Only factory orders and the IBD/TIPP economic optimism index are due today.

EUR

The euro had a mixed run as medium-tier data barely provided support. Final services PMI readings from the region's top economies came in mostly weaker than expected. Only the retail PMI is due today but traders may be positioning ahead of the ECB statement.

GBP

The pound staged quite a rebound from the previous selloff as PM May's speech provided some assurance and UK services PMI beat expectations. The reading rose from 53.0 to 54.5 versus the consensus at 53.3. There are no major reports due from the UK today so the focus could return to Brexit.

CHF

The franc returned some of its safe-haven winnings as risk appetite improved towards the end of the day. There were no reports out of Switzerland then while today has the CPI due. A rebound of 0.3% from the earlier 0.1% dip is eyed.

JPY

The yen caved to dollar strength and returned some of its winnings to the Aussie and Kiwi when risk appetite peeked back. There have been no major reports out of Japan so far and none are due today, so market sentiment could be the main driver.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was still in a weak spot despite the pickup in crude oil and sentiment. NAFTA concerns and remaining fears of a trade war still weighed on the Canadian currency as it stands to be the worst-hit if Trump pushes through with his tariff plans. Economic data from Australia has been weaker than expected today, with the current account deficit widening from 11 billion AUD to 14 billion versus the estimated 12.3 billion AUD shortfall. Retail sales also disappointed with a 0.1% uptick versus the estimated 0.4% gain. The RBA decision is due next.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 7, 2018)

USD

The US dollar had relatively quiet time for the most part of the US session as officials sought to calm fears of a trade war. However, the selling resumed when economic adviser Gary Cohn announced his resignation, which would likely leave stronger protectionist sentiment in the White House, which would prove bearish for the dollar. Medium-tier data from the US has also been downbeat. Only the US Beige Book is due today.

EUR

The euro continued to advance against most of its counterparts as commodity currencies were on shaky footing and another dollar selloff ensued. The region's retail PMI improved from 50.8 to 52.3 to reflect stronger expansion. French trade balance and the region's revised GDP are due today.

GBP

The pound also managed to recoup some of its earlier losses and was able to rake in more gains to commodity currencies. There were no major reports out of the UK yesterday and PM May's recent speech on Brexit has been somewhat reassuring, allowing sterling to regain some ground.

CHF

The franc was off to a weak start as risk appetite returned in the earlier sessions before the rallies resumed later on. Dollar weakness and risk aversion returned to the markets on Cohn's resignation, reviving gains for the lower-yielding currency. Swiss CPI was stronger than expected with a 0.4% gain versus the estimated 0.3% uptick and the earlier 0.1% dip. SNB foreign currency reserves data is due next.

JPY

The yen was returning some of its recent wins as risk appetite appeared to be improving, but it soon resumed the climb when the dollar lost ground on Cohn's announcement. Only the leading indicators report is due today, so the yen could continue to take cues from sentiment.

Commodity Currencies (AUD, NZD, CAD)

The comdolls had a bit of reprieve from their declines in the earlier sessions but the slump resumed as trade war fears escalated on Cohn's resignation. Australia's current account balance and retail sales fell short of estimates but the RBA kept rates on hold at 1.50% as expected. The Loonie took another huge hit on NAFTA concerns. New Zealand reported another fall in dairy prices during the GDT auction while Australia printed a weaker 0.4% GDP reading versus the 0.5% consensus. The BOC statement is coming up next, just after the release of Canada's trade balance and labor productivity report.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 8, 2018)

USD

The dollar recovered slightly from its earlier selloff when the Trump administration sounded open to exempt Canada and Mexico from higher tariffs on steel and aluminum on account of national security. Data was mostly upbeat, with the ADP non-farm employment change beating expectations for February and enjoying an upgrade for January. However, the trade balance showed a wider deficit on weaker export activity. There are no major reports due from the US today so the focus could be on tariffs and pre-NFP positioning.

EUR

The euro gave up some ground to its higher-yielding rivals when risk appetite improved. Traders also likely lightened up on their EUR holdings ahead of the ECB decision today. No actual policy changes are expected but any change in rhetoric could influence tightening expectations. Emphasis on the negative impact of euro strength on inflation could drive the shared currency down.

GBP

The pound also slid lower against its higher-yielding counterparts as Brexit jitters remained in play. There were no reports out of the UK economy but more details on the EU draft agreement didn't look positive for the UK economy. There are still no reports lined up today so the focus could stay on Brexit-related headlines.

CHF

The franc gave back most of its recent gains when risk appetite returned to the markets. SNB foreign currency reserves ticked up from 732 billion to 733 billion, hardly giving any evidence of intervention. The Swiss jobless rate is due today and a dip from 3.0% to 2.9% is eyed.

JPY

The yen also gave up some ground on risk-taking and dollar strength. Japan's leading indicators missed forecasts but today's set of medium-tier data came out mostly better than expected. There are no other reports due next so sentiment could push yen pairs around from here.

Commodity Currencies (AUD, NZD, CAD)

The Loonie was able to recoup its earlier losses when the BOC was slightly more upbeat, with the exception of uncertainties from the Trump administration. Still, the likelihood of seeing exemptions from higher tariffs also proved positive for commodity currencies. Australia reported a higher than expected trade surplus of 1.06 billion AUD versus the 0.21 billion AUD consensus and China is set to report its own next. A deficit of 70 billion CNY is eyed, though. BOC Governor Poloz also has a speech coming up.

By Kate Curtis from Trader's Way

 

[katetrades]

Forex Major Currencies Outlook (Mar 9, 2018)

USD

The US dollar gained some ground to most of peers when Trump tempered his tough talk on tariffs, easing fears of a trade war. The focus shifts back to economic data today with the NFP report due. The US could report a 205K increase in hiring for February, slightly faster than the previous month's 200K gain. This might bring the jobless rate down from 4.1% to 4.0%. Analysts are also keeping close tabs on the average hourly earnings figure, which might post a 0.2% uptick.

EUR

The euro gained a lot of ground during the ECB statement as officials omitted the phrase on further easing. However, the shared currency retreated during the presser as Draghi reminded that this omission should be put in context and that no additional actions have been discussed yet. Policymakers upgraded this year's growth forecast by only 0.1% while downgrading next year's inflation estimate. Medium-tier reports like German and French industrial production are due today.

GBP

The pound also gave up ground even though there were no major reports out of the UK. Today has the manufacturing production numbers on tap and analysts are expecting to see a 0.2% uptick. Brexit jitters still seem to be in play as the EU draft agreement was released earlier in the week. Industrial production could show a 1.5% rebound from the earlier 1.3% fall.

CHF

The franc weakened to its counterparts as risk-taking and dollar strength were in play. The Swiss jobless rate improved from 3.0% to 2.9% as expected. There are no reports due from the Swiss economy today so market sentiment could push franc pairs around.

JPY

The yen also weakened on risk-taking and dollar strength, along with pricing in of expectations ahead of the BOJ decision. No actual policy changes are eyed, although traders appear hopeful for more taper clues. Apart from that, sentiment and dollar demand could push yen pairs around.

Commodity Currencies (AUD, NZD, CAD)

The comdolls, particularly the Loonie, were able to recover on Trump's tempered tone on tariffs. He noted that Mexico and Canada could be exempted while NAFTA negotiations are ongoing while other allies could see special treatment as well. Canada's employment change report is due today and it could show a 21.3K gain hiring after the earlier 88K decline, keeping the jobless rate steady at 5.9%. China printed stronger than expected CPI of 2.9% versus the 2.5% consensus.

By Kate Curtis from Trader's Way