- Philly Fed -12.5 vs +1.1 exp
- Initial jobless claims +362K vs 355K exp
- Markit US PMI 55.2 vs 55.5 exp
- IMF says concerns over drop in yen seem ‘overstated’
- US Jan CPI +1.6% y/y, as exp
- US Jan existing home sales 4.92m vs 4.90m exp
- US Jan leading indicators +0.2%, as expected
- Wal-Mart warns of soft US consumer
- ECB publishes bond holdings
- Poland revised to positive from stable by Fitch
- HSBC cuts cable forecast
- Fed’s Bullard: Asset purchases could be ‘reduced somewhat’ as labor markets ‘improve somewhat’
- Fed’s Williams: Jobless rate to stay above 7% at least until the end of 2014
- Fed’s Fisher worried about housing speculation
- BOE’s Miles: “Good case” can be made for more expansionary monetary policy
- JPY leads, EUR lags
The market was not in the mood for soft US economic data. The combination of soft initial jobless claims and a weak Philly Fed sapped risk appetite. The straightforward trade on risk was to sell the commodity currencies while cross-currents in other pairs made trading more difficult.
The euro was weak on soft European PMIs but traders are also paring back risk ahead of Italian elections.
It’s a similar story for the yen. Abe could name a BOJ nominee as soon as Monday and the announcement will likely come sometime next week.
The yen crosses have been beaten down but they showed some sign of stabilization in US trading. USD/JPY fell just low enough to take out the European low — touching 92.77 — but it quickly rebounded to 93.17. Other yen crosses have also bounced late in US trading.
Speaking of bounces, gold was up $12 to $1576 and the +$40 drop yesterday.
Stocks were soft after the economic data but the S&P 500 has made a late comeback and is down just 0.4%.
