Forex headlines for August 21, 2014:
- August 2014 US Philly Fed business survey 28.0 vs 19.2 exp but details suspicious
- August 2014 US Markit manufacturing PMI flash 58.0 vs 55.7 exp
- US July existing home sales 5.15m vs 5.02m expected
- US initial jobless claims 298k vs 300k exp
- July US leading index +0.9% vs +0.6% expected
- August 2014 eurozone consumer confidence -10.0 vs -9.0 exp
- Fed’s Plosser: Says he is concerned that monetary policy is not reacting to change in data
- Fed’s Williams: Rate hike in middle of 2015 seems reasonable
- Fed’s George says broad based jobs gains signal rates can rise
- UK’s Osborne set to miss borrowing target this year
- J.D. Power forecasts 16.5 million US auto sales rate in August
- SocGen advise selling cable on the central bank hawkish balance
- Argentina’s plan to switch to domestic bonds illegal, judge says
- Japanese think tanks cut GDP estimates for FY 2014
- US 10-year yields down 2 bps to 2.41%
- WTI crude up 52-cents to $93.98
- Gold down $14 to $1277
- S&P 500 up 6 points to record 1992
- NZD leads, JPY lags
The power of Yellen was on full display today. On most days when all the US data beats expectations you’d expect to see some US dollar strength but Yellen has the market so scared of another round of dovish comments that the USD bulls decided to head to the sidelines.
The winners were the commodity currencies as they steadily climbed higher and finished near the best levels of the day. AUD/USD was on a constant march to 0.9303 from 0.9275 at the start of US trading.
The euro also took advantage, on short covering no doubt. Last at 1.3283.
USD/JPY was caught in between opposing forces. The dollar selling weighed overall but the stock market rallying to record highs brought in dip buyers on a slide to 103.60 and the pair is back to 103.83.
Cable remains in the doldrums and even a modest bounce to 1.6600 was met with selling and a drop to 1.6580.
