Forex news for North American trading on August 21, 2017:
- Chicago Fed national activity index -0.01 vs +0.10 expected
- June Canada wholesale trade sales -0.5% vs -0.5% expected
- Mnuchin: Wants more income for middle class in tax reform
- New York Fed release new labor market survey and it's not good
- Ray Dalio: Politics will affect markets more than any time in our lifetimes
- Man wearing explosive belt shot West of Barcelona. Suspected driver killed
- August Belgian consumer confidence +2.0 vs +2.0 prior
- OPEC shipments are down sharply in August - report
- PBOC adviser says yuan may rise to 6.5 per dollar by year-end
Markets:
- S&P 500 up 4.5 points to 2430
- WTI crude up $1.08 to $47.43
- US 10-year yields down 1.2 bps to 2.18%
- Gold up $7 to $1291
- EUR leads, USD lags
The sun didn't shine on parts of the US Monday and it didn't shine on the US dollar as it struggled.
I expected very light trading because it's an August Monday and nothing was on the calendar except the solar eclipse but the market was busy.
The big move came in EUR/USD. The pair grinded lower in European trading and hit 1.1731 before rising to 1.1750 as New York rolled in. From there a steady bid appeared and remained a near-constant in a climbed to 1.1828 as the eclipse began on the west coast. From there, the US dollar showed a bit of life and the pair slipped back to 1.1809.
A similar theme on a smaller scale unfolded elsewhere. The dollar was weak early on but stabilized and bounced late in the day. USD/JPY continues to flirt with some huge levels but held Friday's low and crept up to 108.89 late. It was still a 30-pip loss on the day and that isn't encouraging if you were hoping these levels would hold.
USD/CAD was an interesting case. The loonie was the top performer last week but oil fell 2.4% to start the week and that would usually put some upward pressure on the pair. That was hardly the case as it stuck to the bottom of the daily range ahead of Tuesday's retail sales report.
Cable grabbed some attention as it took advantage of US dollar weakness to push above 1.2900 but it didn't get very far, peaking at 1.2916 and then finishing the day just below the big figure.
AUD/USD finished the day 10 pips higher after falling in Europe. There are increasing concerns about the Chinese property investment crackdown and iron ore prices so AUD could be on the move this week.
