Forex headlines for Oct 28, 2014:
- US durable goods orders Sept -1.3% vs +0.5% exp
- Cap good orders non-defense ex-air -1.7% vs +0.7% exp
- Bank of England’s Cunliffe: We can keep stimulus longer than previously thought
- US Oct consumer confidence 94.5 vs 87.0 expected
- US Oct Richmond Fed +20 vs +11 expected
- US S&P Case-Shiller HPI nsa 167.68 vs 167.35 prev
- ECB’s Noyer says will not accept inflation that is too low in relation to target
- Spain’s De Guindos says he expects Spanish banks to ask for EUR 18bln in second round of TLTROs
- US 10-year yields up 3 bps to 2.29%
- S&P 500 up 22 points to 1984
- Gold up $2 to $1228
- WTI crude up 27-cents to $81.27
- Canadian dollar leads, Japanese yen lags
It’s always a good trading day when the market moves based on the data. It was straightforward on Tuesday with the FOMC looming.
Durable goods data was soft and the US dollar dropped. USD/JPY fell 40 pips to 107.70 while EUR/USD gained 50 to 1.2760 and cable rallied to 1.6180 from 1.6130.
Those levels essentially marked the highs of the day. The flipside came 90 minutes later when US consumer confidence rose to a post-crisis high and the US dollar stormed back. USD/JPY completed the round trip back up to 108.14 and after some chop it finished near the highs of the day.
EUR/USD was more reluctant to give up its gains. The confidence data caused a spike down to 1.2720 but it later bounced to 1.2750 before a slide back to 1.2733.
Cable was doing an even better job of hanging onto its gains up around 1.6160 until Cunliffe cut the legs out of the pair with dovish comments that sparked a drop back to 1.6131.
The best performer on the day was CAD. Oil settlement flows and talk of CAD/JPY buying were drivers. USD/CAD steadily fell to 1.1167 then bounced up to 1.1190 but fell again late in the day to 1.1165. Poloz speaks on Wednesday at a Senate hearing.
AUD/USD jumped to 0.8882 on durable goods from 0.8840 but slide back to 0.8850 and is consolidating a bit higher at 0.8860.
