Forex headlines for January 27, 2013:
- US Dec new home sales 414K vs 455K expected
- Dallas Fed manufacturing 3.8 vs 3.3 expected
- French jobseekers 10.2K vs 1.1K expected
- Markit flash services PMI rose to 56.6
- ECB’s Weidmann says interest rates to stay low for extended period
- Caterpillar ” sees some signs of improvement” in world economy
- Fighting youth unemployment is priority for Italy says PM Letta
- Kocherlakota hints he won’t dissent if the Fed tapers
- Canadian government will announce budget Feb 11
- S&P 500 down 9 points to 1781
- Gold down $15 to $1782
- WTI crude down 80-cents to $95.83
- AUD leads, JPY lags
Despite another volatile day in the stock market, currencies failed to see what all the fuss was about. The euro began US trading at 1.3660 and finishes a dozen pips higher. The range was less than 30 pips.
USD/JPY was a bit more volatile ranging from 102.21 to 102.92 as it swayed alongside stock market sentiment. The takeaway is that the pair failed to break 102 despite another tantrum in stocks and will finish the day around 30 pips higher.
Cable chopped sideways and touched a session high of 1.6589 late in the day but the high was only marginal as offers ahead of 1.6600 cap moves. The low in US trading was 1.6567 — a 22-pip range on the day.
The Canadian dollar was the most active currency. USD/CAD tried the downside in the early going as sentiment appeared to be picking up but large bids ahead of 1.1030 repeatedly stalled the decline and after the weak home sales data the turnaround was on and it was relentless, up to 1.1113.
Commodity cousin AUD was moving in the opposite direction as it edged up in a series of higher highs. The best level was 0.8759, coming late in the day.