The US dollar capped off another good day as it raked in gains from upbeat data and hawkish Fed remarks. Officials George, Williams, and Harker reaffirmed their inclination for tightening again in December while expressing optimism that inflation will eventually pick up. Meanwhile, the trade balance, factory orders, Challenger job cuts, and initial jobless claims all came in better than expected. The NFP is expected to show a gain of 88K in hiring versus the earlier 156K increase, and traders are also likely to pay close attention to revisions and wage growth.


The euro weakened to most of its peers as political uncertainty in Spain was at the front and center. The ECB minutes did little to support the shared currency as there weren’t many tapering clues to be found. Only medium-tier reports like German factory orders, French trade balance, and Italian retail sales are lined up today.


The pound took a huge tumble against most of its counterparts on Prime Minister May’s failure to ignite confidence once again during her latest speech. There were no major reports out of the UK economy then and speeches by BOE members McCafferty and Haldane didn’t dwell too much on monetary policy biases. Only the Halifax HPI is due today, along with another speech by Haldane.


The franc slid across the board as SNB head Jordan hit the newswires with another round of jawboning. He also explicitly stated that it wouldn’t be a good time to tighten monetary policy. Swiss CPI came in line with expectations of a 0.2% uptick while today has SNB foreign currency reserves data due. A large jump in foreign holdings could keep traders wary of central bank intervention.


The yen advanced to most of its higher-yielding counterparts as risk aversion was present in the latter sessions. Japanese average cash earnings jumped 0.9% versus the projected 0.5% uptick and the earlier 0.6% drop. There are no other reports lined up from Japan, leaving yen pairs to be sensitive to global bond yields and dollar price action.

Commodity Currencies (AUD, NZD, CAD)

The Loonie slid lower as Canada’s trade balance disappointed with a larger deficit of 3.4 billion CAD versus the projected 2.6 billion CAD shortfall and the earlier 3.0 billion CAD deficit. Both exports and imports dipped to signal weak internal and external demand. Canada’s jobs report is due next and another miss would severely dampen BOC rate hike hopes. Analysts are expecting to see a gain of 13.9K in hiring. The Ivey PMI is also lined up and could show a dip from 56.3 to 56.0.

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