USD

The US dollar returned some of its recent wins despite stronger than expected economic releases. Headline durable goods orders jumped 3.4% versus the projected 0.3% uptick while core durable goods orders beat expectations with a 0.4% increase. Initial jobless claims and pending home sales also came in better than expected but traders appear to be booking profits ahead of today’s preliminary Q1 GDP reading and Fed Chairperson Yellen’s speech.

EUR

The euro recovered against some of its forex peers bur remained weak against the commodity currencies. There were no major reports out of the euro zone yesterday and none are due today, which suggests that the shared currency could move to the tune of risk sentiment.

GBP

The pound was mostly stronger in the earlier trading sessions but soon retreated on weak data releases. While the second GDP estimate featured no changes, the preliminary business investment
report showed a 0.5% drop instead of the estimated 3.2% gain while BBA mortgage approvals fell short of estimates.

CHF

The franc was still stuck in consolidation to the dollar as there were no major reports out of the Swiss economy recently. There are still no reports due today so the franc might simply trail the euro or react to overall market sentiment, regaining ground on a return in risk appetite.

JPY

The yen had another volatile run, as the currency reacted mostly to sentiment and weak inflation data. Tokyo core CPI showed a 0.5% decline in price levels versus the projected 0.4% drop and the previous 0.3% drop. The national core CPI printed a 0.3% decline, slightly better than the projected 0.4% decrease.

Commodity Currencies (AUD, NZD, CAD)

The comdolls took advantage of the return in risk appetite to erase some of its recent losses while the Loonie kept capitalizing on the BOC’s decision to keep rates unchanged. However, the higher-yielders returned some of their recent wins when crude oil retreated sharply from the $50/barrel level. In Australia, private capital expenditure slumped 5.2% in the first quarter versus the projected 3.2% decline.

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