Economic data from the US came in mixed and the Greenback failed to establish a clear direction as well. Initial jobless claims and HPI beat expectations while existing home sales and the CB leading index fell short, leaving traders in limbo when it comes to December Fed rate hike expectations. For today, US flash manufacturing PMI data is due and a rise from 52.0 to 52.1 is eyed.
The shared currency also chalked up a mixed performance as it rallied then reversed to the dollar, strengthened against the yen, and caved to commodity currencies. There have been no major reports out of the region yesterday but the LTRO did show a smaller 45.3 billion EUR figure compared to the previous 399.3 billion EUR, reflecting weaker long-term loan demand. Euro zone flash PMI readings are due today and small declines in the manufacturing and services sectors of Germany and France are expected.
The pound managed to make a bit of a rebound from its continuous slide earlier in the week as BOE officials gave their testimonies yesterday. MPC members gave a bit of reassurance that Brexit fears may have been exaggerated, reducing expectations of additional easing for the next few months. There are no reports due from the UK today.
The franc was one of the stronger performers for the day as the Swiss currency seemed to rake in the risk-off flows. There were no reports out of the Swiss economy yesterday and none are due today so the franc might continue to depend on overall market sentiment.
The yen returned some of its recent wins as Japanese traders took off for the holiday yesterday. Earlier today, Japan reported a strong flash manufacturing PMI reading, which is up from 49.5 to 50.3 in September instead of falling to 49.3. The all industries activity index is up for release next and a slower 0.2% gain is eyed to follow the earlier 1.0% increase.
Commodity Currencies (AUD, NZD, CAD)
The comdolls had a mixed performance as risk appetite was all over the place. Canadian CPI and retail sales reports are up for release today and analysts are expecting to see small improvements. Headline CPI could come in at 0.1% while core CPI could post a 0.2% uptick. Headline retail sales might recover by 0.2% while core retail sales could post a 0.5% gain.