Forex headlines for September 19, 2013:
- US initial jobless claims 309k vs 330k exp
- September US Philly Fed business index 22.3 vs 10.0 exp
- US August existing home sales 5.48m vs 5.25m expected
- US second quarter current account deficit $98.9B vs $97B expected
- Canadian July wholesale sales +1.5% expected vs +1.2% m/m expected
- Berlusconi will support Letta government if it respects pacts
- Assad says it will cost $1 billion to destroy chemical weapons, take longer
- US oil down 1.7% to 106.21
- CHF leads, JPY lags
- CHF/JPY hits 23-year high
Yarrrr, it was talk like a pirate day and it was trade like a pirate day in FX as the market stole from riches of the traders who bet against the taper and the dollar.
The other story was yen weakness. With the US flooding the markets with liquidity forever the carry trades are back on and risk is brisk. There was also a hint about more QE possible from a hawkish BOJ member.
It was a steady climb for USD/JPY. A set of exporter offers were protecting 99.40/50 in USD/JPY but shortly after the Philly Fed, they gave way, at least momentarily in the push to the session high of 99.62.
EUR/USD was rocking as it hit the highest since 2009 and gained more than 200 pips.
Cable was bogged down and finishes near the lows of the day at 1.6030. Retail sales were soft and it was all downhill from there. Toss in some modest USD strength and it was the worst day for the pound in weeks.
USD/CAD found some solid bids ahead of 1.0180 and marched slowly higher to 1.0265.