Forex news for North American trading on November 1, 2018:
- US October ISM manufacturing index 57.7 vs 59.0 expected
- US final October Markit manufacturing PMI 55.7 vs 55.8 expected
- Canada October Markit manufacturing PMI 53.9 vs 54.8 prior
- US September construction spending 0.0% vs +0.1% expected
- Carney: We'll be extremely interested in Q4 in eurozone data
- Carney Q&A: A 'no deal, no transition' scenario is unlikely but we must prepare
- Carney: Expectations of households and businesses diverging from forecast
- US Q3 preliminary non-farm productivity +2.2% vs +2.1% expected
- Weekly US initial jobless claims 214K vs 212K expected
- US October Challenger job cuts +153.6% vs +70.9% y/y prior
- Canada light vehicle sales fall 1.9% in October from a year earlier
- Trump calls Venezuela, Cuba and Nicaragua the 'troika of tyranny'
- China's Xi says willing to meet Trump at G20 meetings
Markets:
- WTI crude down $1.77 to $63.54
- S&P 500 up 28 points to 2740
- US 10-year yields down 1.5 bps to 3.38%
- NZD leads, USD lags
It was a new month with a completely new theme. The US dollar was battered with the kiwi, aussie and pound sizzling to some of their best days of the year.
The pound was the big story as an FT report about a Brexit deal on financial services sent cable initially 35 pips higher but from there the momentum was non-stop. The BOE added to it with a slightly higher forecast and then technicians pushed it all the way to 1.3020, more than 240 pips at the highs before a smidge of selling back to 1.3000 late.
The euro made a beautiful technical move as it bounced off 1.1301, which was the August low. After almost matching it to the pip late yesterday it started on a steady climb higher to 1.1408.
Normally that would be a headline move but it was overshadowed by huge moves in AUD and NZD that came after Australian trade balance. The Aussie has been flirting with 0.7000 for weeks and finally made a break in the other direction up to 0.7206. The NZD move was even bigger in percentage terms as it ripped to 0.6650 from 0.6520.
It was a bumpier ride for their Canadian commodity cousin. Initially, USD/CAD dropped quickly down to 1.3075 from 1.3160 but oil dropped below some big support levels in another 3% fall and that pushed USD/CAD back up to 1.3116 before late selling pushed it back down to 1.3080.
Stock market sentiment was good but USD/JPY fell for the second day in a slide to 112.65 from 112.90. The pair was relatively quiet as everything else was beating up on USD and JPY.
