On Friday, the greenback remained on tenterhooks, finding itself on track for a moderate weekly soar ahead of Fed Chair Janet Yellen's long-awaited speech that some believe could ensure clarity on whether American interest rates will soar this year or not.
The US dollar dipped 0.1% against the Japanese yen at 100.46 yen, while it remained intact against the euro at $1.1290.
The dollar index, estimating the greenback’s value against six key counterparts, slumped 0.1% to 94.718.
Later on Friday, Fed Chair is expected to deliver her speech at a global major bank meeting in Jackson Hole, Wyoming. Yellen could provide a clear signal that the Fed is all geared up towards a rate hike this year, although many experts are assured that she’ll stick to her less concrete stance that monetary policy appears to be data-dependent and a rate lift is probable.
The anticipation is quite exaggerated, especially considering that Yellen is considered to be one of the most balanced and pragmatic speakers.
Yen rebounds in Asia
Today, the Japanese yen rebounded during Asia trade after consumer prices data from Tokyo revealed that the core measure decreased more than expected. Moreover, attention is currently focused on a gathering of key bankers in the US state of Wyoming later in the day with the Fed Chair expected to provide fresh views.
The currency pair USD/JPY traded at 100.47 with a 0.05% sink, while AUD/USD achieved 0.7629, rising 0.14%.
In Japan, July’s national core CPI headed south 0.5% year-on-year, which is more than the 0.4% decrease observed, while national CPI lost 0.4% as expected in data, which is currently calculated under a 2015 base year with updated weightings.
The US dollar index, estimating the greenback’s value against a trade-weighted basket of six key currencies, sank 0.06%, getting to 94.62.
The annual economic symposium has found itself in the spotlight with Fed Chair’s opening remarks on Friday. Other major bankers are expected to discuss and also consider the future of monetary policy in the aftermath of the financial downtime and a low interest rate era.
On Thursday, the major American currency happened to be range-bound during illiquid Asia trade as key currencies kept treading water ahead of the global major bankers' gathering in Jackson Hole, Wyoming, at which Fed Chair Janet Yellen might offer fresh clues on American monetary policy.
Fed officials including Vice Chairman Stanley Fischer along with New York Fed President William Dudley have recently helped some traders to lift their bets that the Fed is braced for rate hikes again sooner rather than later, while some financial analysts foresee Yellen will echo their signals.
On Wednesday, futures markets were indicating an 18% probability that the American major financial institution would lift rates at its policy gathering next month, and an approximately 50% chance of a rate hike in December, as CME Group's FedWatch states.
A portion of the financial market is currently expecting hawkish overtones after Dudley.
Aussie and Kiwi head north ahead of Yellen’s speech
The Australian as well as New Zealand dollars went up against their American counterpart, as sentiment on the US dollar turned more fragile ahead of American data due later in the day and a Yellen’s speech on Friday.
The currency pair AUD/USD soared 0.21%, trading at 0.7629.
Market participants are waiting to see if Yellen will restate her hawkish view of the American economy expressed by Fed representatives the previous week or echo the minutes of the Fed’s July gathering, which pointed out that Fed officials are divided on when to lift rates.
Traders were also looking ahead to reports on American jobless claims as well as durables goods orders, due later Thursday, for further clues on the strength of the US economy.
The currency pair NZD/USD descended 0.08%, being worth 0.7319, thus re-approaching a recent 15-month peak of 0.7347.
Meanwhile, the commodity currencies gained some support as crude prices bounced back on Thursday, notwithstanding a sudden soar in American stockpiles last week.
On Wednesday, the evergreen buck grew, moving off its recent minimums against the major Japanese currency overnight, as financial markets looked to a meeting of global major bankers in Jackson Hole, Wyoming for hints whether the Fed is braced for raising interest rates again or not.
Tuesday’s data revealed that in July, new American single-family home sales suddenly soared, reaching their highest value in almost nine years as demand surged broadly, brightening the housing market outlook.
At the end of the week, Fed Chair Janet Yellen is expected to address the key bankers gathered for the annual mountain retreat, which starts on Thursday.
Recent hawkish comments from Fed Vice Chairman Stanley Fischer as well as New York Fed President William Dudley have spurred some investors' hopes that Janet Yellen might take a less cautious tone.
The US dollar soared 0.1% to 100.30 yen having nudged below 100 yen overnight to 99.925.
The dollar index, traditionally estimating the evergreen buck’s strength against a basket of six key counterparts, grew 0.1%, being worth 94.593.
Aussie and Kiwi tumble moderately in Asia
The New Zealand and Australian dollars descended modestly after recent data revealed that missed hopes as well as cautious trade ruled ahead remarks due at the end of the trading week from the Fed Chair.
In Australia, construction work done edged down 3.7% during the second quarter, quite below the tumble of 1.9% observed quarter-on-quarter. Earlier, in New Zealand, July’s trade balance came in at a deficit of about NZ$433 million month-on-month as well as at a deficit of NZ$3.03 billion year-on-year. Both those outcomes have turned to be wider than expected.
The currency pair NZD/USD was worth 0.7285, down 0.05%. Meanwhile, AUD/USD sagged 0.01%, trading at 0.7614. USD/JPY traded at 100.26, showing a 0.02% rise.
Overnight, the greenback remained broadly lower against the other key currencies, as market participants remained cautious ahead of Friday’s statement by Fed Chair Janet Yellen.
In June, new home sales were revised down to 582,000 units a 1.7% revenue, from the previous reading of +3.5% to 592,000 units.
On Tuesday, the evergreen buck tumbled against the Japanese yen, while the New Zealand dollar went up right after the country’s major financial institution informed that they don’t see the necessity for a rapid succession of interest rate drops.
The evergreen buck lost 0.1% to 100.220 against the safe-haven Japanese yen amid a pullback in Tokyo shares.
The greenback had soared to nearly 101.00 yen overnight, reacting to hawkish-sounding comments by Federal Reserve Vice Chair Stanley Fischer.
The euro grew 0.1% to $1.1332, thus stepping off an overnight minimum of $1.1271.
The Australian dollar ascended 0.1%, being worth $0.7638 , moving up on the coattails of the New Zealand dollar.
The New Zealand dollar appeared to be a relatively big mover in a subdued Asian trading session.
The New Zealand dollar earned 0.6%, being worth $0.7308 after Reserve Bank of New Zealand Governor Graeme Wheeler informed that the current interest rate track suggests further monetary easing, although he didn’t see the need for an instant series of rate drops.
Kiwi rises further along with yen and Aussie
The New Zealand dollar kept rising in Asia, notwithstanding remarks from RBNZ Governor Graeme Wheeler on the scope for further interest rate drops, while the Australian dollar and the Japanese yen ascended too, following a light regional data day.
The currency pair NZD/USD was worth 0.7298, rising 0.36%. Meanwhile, AUD/USD traded at 0.7635, demonstrating a 0.20% soar, while USD/JPY was worth 100.13, tumbling 0.20%.
The US dollar index, gauging the US dollar’s value against a trade-weighted basket of six key counterparts, traded 94.46, descending 0.06%.
Traders are currently focused on a highly anticipated speech by Fed Chair Janet Yellen at the annual gathering of top major bankers as well as economists in Jackson Hole, Wyoming, this week for new signals on the timing of the approaching US rate lift.
Overnight, the evergreen buck pared profits against the other key currencies in subdued trade on Monday, though hopes for a probable American rate lift before the end of the year still ensure support to the US dollar.
On Tuesday, the evergreen buck hit one-month minimum against the Japanese yen, staying on the defensive after recent American economic data were seen likely to restrict the prospects of a near-term Fed interest rate lift.
The dollar tumbled 0.8% to 100.43 yen and hit a minimum of 100.355 yen at one point, the dollar’s lowest reading against the yen in more than a month.
It feels like there’s a broad acceleration in greenback-selling momentum.
Against a basket of six key currencies, the major American currency sagged 0.2%, hitting 95.417.
As for the common currency, it rose 0.1%, getting to $1.1195. Against the Japanese yen, the euro slumped 0.7% to 112.45 yen.
The greenback has rebounded against the Japanese yen and the common currency after weaker-than-expected July retail sales were observed likely to delay a Fed rate lift.
The markets will wait for American data later in the day including housing starts, consumer prices as well as industrial output for another chance to estimate the health of the economy.
Aussie holds narrow revenues after RBA board views on inflation
The Australian dollar held revenues during Asia trade after Australia major bank minutes noted uncertainty in inflation predictions as market participants kept monitoring policy moves by regional major banks.
The currency pair AUD/USD traded at 0.7677, showing a 0.05% rise, while USD/JPY traded at 101.03, tumbling 0.22%.
The US dollar index, measuring the greenback’s strength against a trade-weighted basket of six currencies, sank 0.03%, trading at 95.55.
Overnight, the evergreen buck sagged on Monday as a rash of subdued economic data in Asia backed the possibility for further stimulus measures from major banks, applying downside pressure on the volatile greenback.
On Monday, traders kept monitoring global major bank activity closely ahead of next week's Jackson Hole Summit for major bankers in Wyoming.
Meanwhile, the Nikkei dropped 0.3% amid subdued economic growth in Japan during the three-month period through June, driving concerns that further stimulus plans could be forthcoming right before the end of the year.
EconomyVN - Yesterday, all three US stock indexes reached record highs.
Although it is 3 months until the election, but according to investors on Wall Street, US stocks are following current trends like Hillary's victory, because by far Wall Street agree that, if Hillary has a victory, the stock will rally. History shows that every candidate of incumbent President party wins, the market will go up. In this case, that is Hillary Clinton.
Currently, the stock investors have also an interesting test, in which they track the market in three months, from August to November. If the trend of the stock rallies, Hillary wins. And conversely, it decreases, Donald Trump will be elected.
While the latest figures show that, although he advised people to withdraw money from the market, but Trump has also a large investment in stock, up to 100 million USD.
On Friday, the evergreen buck held firm, backed by comments from a Fed speaker, suggesting that an American interest rate hike this year is still real because inflation pressure keeps growing.
American retails sales data along with a series of Chinese economic indicators due later in the day will be the market's next key focus points, though trading could be slow with many investors in Japan on leave this week for the summer holidays.
The dollar's index against a basket of six key counterparts edged up to 95.906 from this week's minimum of 95.442 achieved on Wednesday, though it will probably conclude the week lower, having lost approximately 0.3% so far.
The evergreen buck appears to be on a much more substantial footing than when financial markets were worried about the actual impact of Brexit. It might take time a bit but its direction is definitely looking upwards.
Against the Japanese yen, the evergreen buck firmed to 101.83 yen from this week's minimum near 101 yen, although it stood still on the week so far.
Aussie goes down on disappointing China data
The Australian dollar sagged on gloomy data out of key trading partner China on industrial output, retail sales as well as fixed-asset investment.
China’s fixed-asset investment for July soared 8.1%, below a pace of 8.8% observed year-on-year, while industrial production acquired 6.0%, also below an expected at 6.1% year-on-year revenue, while retail sales headed north 10.2% under the expected up 10.5% year-on-year growth observed.
The currency pair AUD/USD traded down 0.26%, hitting 0.7190, while USD/JPY was worth 102.15, up 0.19%.
Earlier, in New Zealand, the Business NZ PMI tumbled to 55.8 for July, sagging from a previous reading of 57.7. Moreover, core retail sales for the second quarter leapt 2.6%, better than the quarter-on-quarter reading observed up 1.1%. As for full retail sales, they spiked too, approximately up 2.3%, compared to a 0.9% quarter-on-quarter revenue observed and an annual pace of 6.0%, thus outpacing the 4.9% expected from the same quarter a year ago.
The currency pair NZD/USD hit 0.7195, showing a 0.21% sag after of the figures and also a statement that the major bank would delay measures just to curb house loans.
EconomyVN - USD dropped against most of the major currencies during yesterday's trading session as investors reassess the ability to raise interest rates by FED this year in the context of no new additional economic indicators might indicate clearly about the US economy's health.
The greenback strengthened as reported non-farm jobs in July announced on Friday (05th of August), much better than expected, increasing speculation that Federal Reserve will raise interest rates later this year . However, dollar's rally has stalled in the absence of catalysts in the context of the trading volume expected this week at a low level because many investors entered the summer vacation.
Many analysts predict FED will raise interest rates in December this year and believe that the Fed will not act before the President election in November. The speech of Federal Reserve Chairman Janet Yellen at the annual conference of the finance ministers and central bank governors in Jackson Hole, Wyoming on 26th of August are closely monitored by investors for more clues about when interest rates are raised.
The dollar continues to have 3 consecutive declines with a quite sharp fall on Wednesday supported the gold prices rallied in Asian, European and early US session. Nevertheless, then taking profit has braked the rise in gold prices and closed with modest gains. At End of yesterday session, gold prices rose 6 dollars to the world $ 1.346 / ounce.
The market today continues absence of information important impact. Economic data released today is the number of last week applications for US unemployment with the forecast of rising slightly from 269,000 to 272,000. As volume this week is forecast at a low level, data is launched today can impact on the evolution of the main currency pairs in the market.
On Tuesday, the British pound sagged to fresh one-month minimums against the major American currency, after the issue of gloomy British manufacturing data contributed to worries regarding the actual strength of the British economy.
The currency pair GBP/USD grasped 1.2968 during European morning trade, the pair’s lowest reading since July 11. However, the given pair subsequently consolidated at 1.2978, dropping 0.47%.
Cable was about to find support at 1.2848, the minimum of July 11 as well as resistance at 1.3178, the peak of August 5.
The British Office for National Statistics told manufacturing production slumped by 0.3% in June, somewhat worse than expectations for a 0.2% dip and following a sag of 0.6% a month earlier, that was revised down from an initial 0.5% slump.
On an annualized basis, in June manufacturing production edged up 0.9%, worse than forecasts for a 1.3% leap.
The report also revealed that in June, industrial production went up by 0.1%, in line with forecasts. In June, year-on-year, industrial production soared by 1.6%, matching forecasts.
Aussie drops after weak NAB polls
The Australian dollar sagged during Asia trade after downbeat business surveys from National Australia Bank as well as consumer and producer prices data from China, suggesting mild pressure on prices although unlikely enough to spur any monetary policy action.
The currency pair AUD/USD was worth 0.7639, demonstrating a 0.16% tumble, while USD/JPY traded at 102.51, rising 0.06%.
In Australia, NAB business confidence was at plus-4 for July, compared to a previous outcome of plus-6, along with the NAB business poll that reached plus-8, versus a previous reading of plus-12.
China posted CPI for July with a 0.2% revenue in July, a faster tempo than the 0.1% revenue observed month-on-month as well as an annual level of 1.7%, just a bit below a 1.8% pace observed year-on-year. Meanwhile, PPI figures from China disclosed a dip of 1.7%, less than the drop of 2.0% year-on-year expected. The data came after weaker than expected imports the previous month in China posted on Monday and hit sentiment on demand prospects.
Ending the regular policy meeting on 04th of August, Bank of England (BoE) announced lower interest rates from 0.5% to 0.25%. This decision was adopted by all 9 members of Monetary Policy Committee (MPC) and this is the first time this agency changed interest rates since March 2009. Along with lower interest rates, BoE announced a program of pumping large-scale money into the economy.
Also during this meeting, BoE cut the forecast for UK economic growth strongly since beginning this prediction in 1993. Accordingly, BoE cut its forecast for UK economic growth in 2017 to 0.8 % from 2.3% given in May. The forecast growth this year is unchanged at 2% by GDP of the first half of the year increased sharply over the previous forecast. BOE also forecasts that the unemployment rate would rise to 5.4% in the following year and 5.6% in 2018.
The interest rates cut of BoE has been predicted by the analyst, however, restarting the asset purchase program makes the market unexpected. The pound has depreciated 1.5% against the dollar after BoE's statement. At a press conference later, Governor Mark Carney said MPC launched these measures because the economic outlook has changed dramatically.
Governor Mark Carney also said the majority of MPC members supported adding a further cut of interest rates as well as the further implementation of other measures to stimulate if the data shows that the economy deteriorated. However, many analysts believe that BoE is likely to wait for several months to assess the impact of current measures for the economy before continuing other actions, and the market does not expect the next strong decline of GBP.
The attention of the market today focuses on employment report announced by US Labor Department. Analysts forecast, in July, US economy added only 180,000 new jobs after creating an additional 287,000 jobs in June and the unemployment rate fell from 4.9% to 4.8%. US dollar will be supported if job growth will be at around 200,000 and the unemployment rate and wage growth will be positive as expected. In the case of disappointing jobs data, the dollar will be under pressure big discount.
GBP/USD SELL: 1.3180; TARGET: 1.3020; STOP-LOSS: 1.3240