Forex headlines for Sept 16, 2013:
- 12 killed in shooting at US navy headquarters, one gunman may be at large
- Turkey shoots down Syrian helicopter
- Empire Fed manufacturing index +6.3 vs +9.2 expected
- Odds on favorites for Fed Chair
- Italy to forecast 132.2% debt-to-GDP in 2014 up from a previous forecast of 129.0%
- Out of Spain means out of Europe EC vice president tells Catalonia
- Canadian August home sales 11.1% higher than last year
- August US industrial output 0.4% vs 0.4% exp m/m
- AUD leads, USD lags
The US dollar bottomed early in US trading but the Larry Summers trade began to fade afterwards. The dollar took out minor intraday stops, reaching 1.3387 in EUR/USD but the market was tepid. Similarly cable touched 1.5964 — about 5 pips above the European high — and then it fizzled. That was a sign to square up ahead of the Fed on Wednesday.
EUR/USD has faded back to 1.3339 and GBP/USD is hovering around 1.5900. Technically, most pairs have entered the gaps that from the announcement of Summers’ withdrawal. That’s a good sign for the US dollar.
USD/JPY is at 99.09 after falling to 98.64 at the start of US trading. It’s a very similar story across the board with the buck recovering about 50 pips. It’s made for much smaller losses on the day.
