The US dollar struggled to find a clear direction on Friday and took a bit of a hit on profit-taking at the end of the month and quarter. Economic data from the US came in mixed last Friday, as Chicago PMI and the revised consumer sentiment index from the UoM beat expectations. The core PCE price index and personal income reading came in line with expectations while personal spending fell short. The ISM manufacturing PMI is due today and a rise from 49.4 to 50.4 is expected.
The euro was able to recover slightly after the Deutsche Bank news sparked weakness earlier in the week. Euro zone data came in mixed, with French consumer spending and CPI beating expectations while the core CPI flash estimate fell short. Final manufacturing PMI readings are due from its top economies today and significant downgrades could mean losses for the shared currency.
The pound was off to a weak start this week as it gapped down to its counterparts after UK PM Theresa May signaled that they will invoke Article 50 by the first quarter of next year. UK current account balance, final GDP and revised business investment numbers all beat expectations on Friday. UK manufacturing PMI is due today and a dip from 53.3 to 52.1 is eyed.
The franc lost ground to some of its peers as risk appetite made a quick recovery at the end of the week. Data from Switzerland was better than expected as the KOF economic barometer rose from 99.7 to 101.3, outpacing the consensus at 100.5 Swiss retail sales data is due today and a 1.6% year-over-year drop is eyed, marking an improvement from the earlier 2.2% slide.
The yen was still the weakest performer on Friday as BOJ core CPI missed expectations, confirming that the central bank is likely to add stimulus. Over the weekend, the Tankan report was released, with the manufacturing component unchanged at 6 instead of improving to 7 and the non-manufacturing component down from 19 to 18 as expected. There are no reports due from Japan today.
Commodity Currencies (AUD, NZD, CAD)
The comdolls were off to a weak start this week as risk aversion seems to be returning. Over the weekend, Chinese PMI readings came in line with expectations, as the manufacturing PMI held steady at 50.4 while the non-manufacturing PMI rose from 53.5 to 53.7. Australia’s MI inflation gauge rose from 0.2% to 0.4%. There are no other reports due from the comdoll economies for today.