Forex news for US trading Thursday 9 April 2015:
- Initial jobless claims 281K vs 283K expected
- US Feb wholesale trade sales -0.2% vs +0.3% exp
- ECB raises ELA to Greek banks to €73.2B from €72.0B
- Canadian Feb new housing price index +1.4% y/y vs +1.4% y/y expected
- Saudi oil advisor says it's too early to talk about OPEC decision at June meeting
- IMF's Lagarde: Global growth is moderate, roughly the same as 2014
- IMF Lagarde: I would not say dollar getting to strong
- Brazil outlook downgraded to negative from stable by Fitch
- US sells 30-year notes 2.597% vs 2.570% WI
- Iran says nuclear accord will only be signed if all sanctions are immediately removed
- WTI crude up 21-cents to $50.63
- Gold down $7.78 to $1194
- S&P 500 up 9 points to 2091
- AUD leads, EUR lags
The US dollar was in full flight on Thursday as the momentum from yesterday's FOMC minutes continued. The chief losers were the euro and pound while the commodity currencies were damaged in US trading but only moderately.
EUR/USD led the way lower. It was roughly unchanged on the day at 1.0775 as New York trading began but it embarked on a slow grind lower from the get-go. Greek chatter and the ELA weighed a bit but it's tough to pin any of the weakness on it. Eurozone yields continued to fall in what was probably a larger factor. The selling accelerated as the European low of 1.0728 gave way. There was never really a crescendo or acceleration in selling but it was a non-stop slide down to 1.0638 and the chart looks ugly.
Cable fared no better and looks no better. It was in the midst of a 70 pip bounce to 1.4845 when US traders arrived and it was a steady decline to 1.4683. A late dead-cat bounce to 1.4712 wasn't enough to prevent the lowest close since 2010.
USD/JPY benefited from broad dollar demand in a climb from 120.00 to as high as 120.74. Buying accelerated above 120.40 on a very weak 30-year bond auction. Long bond yields end the day up 7 bps on talk the Fed will be slow to get wherever it's going, no matter when liftoff comes.
USD/CAD was quieter but that still meant a nearly 100 pip range. It dipped toward 1.25 early but bidders were waiting and it turned around and touched above 1.2600. Oil rallied to $52 and that halted the rally but some fresh selling into the oil settlement sent it back to 1.2580.
AUD/USD made a fresh post-RBA high at 0.7739 and was chopping around there until US traders began to sell and it was a one-way ride to 0.7691 from there. The Aussie still looks like it's in decent shape but there is a considerable amount of worry about China and iron ore.
Overall, the dollar move may have 'come out of the blue' but it's a great example of the power of the trend.
