– Today’s US data could roil FX markets.
– Oil prices slide.
– US dollar little changed from Wednesdays closing levels.
USDCAD: open 1.3470, overnight range 1.3460-1.3487, close 1.3484, WTI $68.68, Gold, $2668.98
The Canadian dollar has paused. Yesterday, traders banked some profits ahead of a slew of US economic reports and remarks and speeches from a flock of Fed officials due today.
The economic data includes, Weekly jobless claims (forecast 225,000), Core PCE, August Durable Goods Orders, and Q2 GDP are on tap. The data is more important than usual as the strength (or weakness) of the results will either reinforces calls for another 50 bp rate cut on November 7, or just a 25 bp reduction.
However, the remarks from the policymakers may carry more weight. Fed Chair Jerome Powell, New York Fed President John William’s Governor Lisa Cook and Minneapolis Fed President Neel Kashkari are a few of the Fed officials talking today.
Oil prices tumbled on news that Saudi Arabia is planning to increase production beginning in December while some previously shut-in Libyan production comes back on line. WTI Fell from 70.00 to 67.17.
Chinese President Xi Jinping announced fiscal stimulus plans that include injecting $142 billion into state-own banks while saying that will make the real estate market “stop declining.”
EURUSD bounced within a narrow range of 1.1126-1.1158 range. The Swiss National Bank reduced its benchmark rate by 25 basis points, lowering it from 1.25% to 1.0%, and hinted at further cuts due to rising downside inflation risks.
GBPUSD moved higher within a range of 1.3312-1.3369, buoyed by improved global risk sentiment after China introduced fiscal stimulus measures. Additionally, differing rate outlooks between the Federal Reserve and the Bank of England continue to support GBPUSD.
USDJPY initially climbed from 144.44 to 145.20 in European trading, before pulling back to 144.59 at the start of the New York session, as the US 10-year Treasury yield eased slightly. Traders remained cautious ahead of scheduled Federal Reserve speakers and upcoming US economic reports.
AUDUSD trade higher in a 0.6819-0.6874 range with prices getting a lift by optimism around China’s stimulus measures and hopes that upcoming US data will support expectations for another 50 basis point rate cut.
