The US dollar was in a weak spot in the earlier sessions but was able to get back in the game during the New York hours. Data from the US economy actually came in weaker than expected, with initial jobless claims landing at 294K and import prices posting a meager 0.3% uptick. FOMC officials sounded optimistic about economic prospects, maintaining that negative rates are not needed and that the likelihood of a rate hike is higher than what markets are pricing in. US retail sales and PPI numbers are due today.
The euro advanced in the London session but eventually retreated to its counterparts. Medium-tier euro zone data came in line with expectations then but traders probably booked profits ahead of today’s top-tier releases. GDP readings from the euro zone’s top economies are lined up ahead of the region’s growth figure, which might show a 0.6% expansion for the first quarter. Germany is also set to print its final CPI reading while France will report its non-farm payrolls figure.
The pound experienced a lot of volatility on Super Thursday but overall, the central bank was not as dovish as expected. BOE officials even upgraded their inflation forecasts slightly, but policymakers stressed that this was contingent on EU membership. Governor Carney reiterated the risks of a Brexit, adding that a technical recession might ensue and that monetary policy alone won’t be enough to counter these effects. Still, the bank kept policy unchanged as expected in a unanimous vote. BOE members Haldane and Weale have testimonies today.
The franc rallied then reversed for the day, as the currency took its cue from the euro and overall sentiment. There are still no reports lined up from the Swiss economy today so the franc could be driven by similar themes.
The yen regained a bit of ground towards the latter trading sessions, especially against the commodity currencies. The Economy Watchers sentiment index turned out weaker than expected, as it fell from 45.4 to 43.5, lower than the projected 44.9 reading. The tertiary industry activity index is due today and a 0.2% drop is eyed.
Commodity Currencies (AUD, NZD, CAD)
Comdolls were still mostly weaker against their peers, as traders returned to their rate cut reactions and expectations. New Zealand retail sales came in slightly weaker than expected, as the headline figure rose 0.8% versus the projected 1.0% increase while the core figure posted a 1.0% gain instead of the estimated 1.1% reading. There are no reports due from the comdoll economies today, although Chinese industrial production and retail sales readings are due over the weekend.