Currencies higher against dollar

Overall, a very solid round of data overnight has helped to keep USD bulls in check for the time being, with the euro recouping a good portion of its Asian setbacks, and most other major currencies tracking higher against the greenback on the day thus far. German producer prices were firmer, Swiss trade data was solid, and UK retail sales were outstanding, to help drive the latest price action.

Relative Performance Versus USD on Thursday (As of 11:20GMT)

  1. CAD+0.41%
  2. AUSSIE+0.36%
  3. SWISSIE +0.32%
  4. STERLING+0.30%
  5. EURO-0.03%
  6. YEN-0.12%
  7. KIWI-0.25%

However, despite this latest round of data, the gains in the currency market have been far less impressive than one might think considering the recent propensity and drive to want to sell USDs. Perhaps the marginal gains against the buck suggest that any additional weakness for the U.S. dollar is now limited with many seeing the buck as an attractive investment at current levels. It is also worth noting that despite the solid round of data overnight, risk trades have not performed well, with then Yen crosses failing to push higher, and the Eur/Chf cross trading lower.

Things have also not been all good, with RBNZ Bollard out with some downbeat comments on the New Zealand economy, while talk of some potential ratings downgrades to France also made the rounds. Right now we are seeing a bit of a divergence between US equity futures, which are looking for a positive risk session, and currencies which don’t appear ready to commit to either direction at this point. Meanwhile, the commodity markets are also providing no clues, as both oil and gold prices are relatively flat.

Looking ahead, U.S. continuing claims (4500k expected) and initial jobless claims (480k expected) are due out at 12:30GMT, along with Canada leading indicators (0.7% expected) and wholesale sales (0.4% expected). U.S. leading indicators (0.1% expected) and the Philly Fed (7.2 expected) are then out at 14:00GMT. On the official circuit, Fed Bullard is slated to speak on the topic of the economy at 16:30GMT.

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