The US dollar had a mixed run as it reacted to other currency-specific factors. Data turned out stronger than expected as headline retail sales rose 0.8% versus the estimated 0.3% gain while the core reading posted a 1.0% jump versus the estimated 0.6% increase. Import prices posted the projected 0.7% gain while the flash manufacturing PMI also beat consensus. Industrial production and capacity utilization numbers are lined up, along with the Empire State manufacturing index.
The euro tumbled during the ECB decision and presser even as the central bank upgraded growth and inflation forecasts. Draghi refrained from dropping any hints on interest rate hikes, which left bulls disappointed. Euro zone trade balance is due next and a smaller surplus of 24.4 billion EUR from the earlier 25 billion EUR is eyed.
The pound was also in a weak spot following the BOE decision as policymakers had a unanimous vote to keep rates and asset purchases unchanged. The central bank cited Brexit as a risk in their economic outlook. Only the BOE quarterly bulletin and a speech by MPC member Haldane are lined up from the UK today.
The franc had another mixed run as the currency reacted to market sentiment and currency-specific factors. The SNB kept policy unchanged and reiterated that the franc remains overvalued but stopped short of intervention threats. There are no reports due from the Swiss economy today so sentiment could be the driving factor.
The yen was able to regain some ground to the euro, pound, and Kiwi. The Tankan report had mixed results, with the manufacturing index up from 22 to 25 versus the consensus at 24 and the non-manufacturing component steady at 23 instead of improving to the consensus at 24. There are no other reports lined up from Japan so sentiment could push yen pairs around.
Commodity Currencies (AUD, NZD, CAD)
The Loonie got a bit of a boost from Poloz’s testimony as the central bank head mentioned that there is less need for stimulus for the Canadian economy. He still warned of several uncertainties, including youth unemployment, but appeared overall confident in his outlook. There are no other reports lined up from the comdoll economies.