Forex news for New York trading on Aug 23, 2016
- Iran sending positive signals to support joint OPEC action
- Iran oil ministry official won't confirm Iran's attendance at upcoming meeting - DJ
- Iraq has not yet reached it full oil market share - Prime Minister
- July US new home sales 654K vs 580K expected
- Richmond Fed manufacturing index -11 vs +6 expected
- Markit US Aug prelim manufacturing index 52.1 vs 52.6 expected
- China accelerating capacity cuts at state-owned enterprises
- Majority of regional Fed banks voted for discount rate hike
- Fed's Kaplan: Rate rise warranted if jobs trend continues
- US sells 2-year notes at 0.760% vs 0.770% WI
- South Africa's finance minister may be charged with crime
- Eurozone consumer confidence -8.5 vs -7.7 expected
- Redbook US same store sales +0.2% y/y
- Philly Fed non-manufacturing index 24.8 vs 28.8 in July
Markets:
- Gold flat at $1338
- WTI crude up 56-cents to $47.96
- S&P 500 up 4.2 points to 2186
- US 10-year yields flat at 1.54%
- GBP leads, AUD lags
The general theme in US trading was US dollar strength but it was of the mild variety. EUR/USD slipped down to a low of 1.1303 from around 1.1340 when New York arrived. We're trading a few pips off the lows at the moment but it's a grind.
Elsewhere it was similar as the US dollar got a bid follow the 9-year high in new home sales. AUD/USD was near 0.7645 ahead of the data, fell 15 pips on the released and continued lower to 0.7615.
USD/JPY was more on the flat side as it chopped between 100.00 and 100.25. There is increasing talk about the consequences of the LIBOR squeeze and rising costs in the FX swaps market. If anything, that's what will roil the market in the coming weeks rather than the Fed.
The FOMC discount minutes sent a hawkish signal and led to some fractional dollar strength but it was largely ignored. I think it's a fairly strong sign that Fed Presidents are gunning for a hike sooner rather than later but the Governors denied the vote so maybe that's a sign too.
Cable was tops today as it touched 1.3210 but the trade was a chop around 1.3195 without and sign of direction. Still, we're at the top of the recent range with little in the way of resistance.
Looking ahead, the kiwi hit a 14-month high but only for moments. The quick move above 0.7340 was cut back down and the pair finished at 0.7293.
