Forex headlines for September 6, 2013:
- Non-farm payrolls 169K vs 180K exp
- Canadian jobs +59.2K vs +20K exp
- Mexican central bank cuts overnight rate to 3.75% from 4.00% in shock decision
- Niesr UK GDP estimate +0.9%
- Canada Ivey PMI 51.0 vs 53.0 exp
- Fed’s Evans says he will go to FOMC meeting with an open mind
- Fed’s George favors $15 billion taper
- Hilsenrath calls Fed decision a ‘cliffhanger’ in latest WSJ article
- Chatter about an Italian bank bailout
- Latest counts show Obama has a difficult (maybe impossible) task to convince Congress to bomb Syria
- The latest CFTC positioning data
- BRICS to commit $100 billion to FX fund, completion a way off
- Gold gains $21.55 to $1389
- US oil up $1.80 to $110.18
- S&P 500 closes flat at 1655, up 1.4% on the week
The dollar plunged as the non-farm payrolls headlines hit. The main change wasn’t bad but revisions and a drop in the participation rate made the report worse than it appeared. USD/JPY instantly fell to 98.85 from 99.75 and then later fell to 98.56 as Putin stirred up talk on Syria. It was later shown that his comments were misinterpreted. That, along with better risk sentiment helped USD/JPY recover to 99.27. Late the the day some (probably dubious) claims of Syrian gas attacks weighed on the pair down to 99.06.
EUR/USD jumped to 1.3177 from 1.3121 on NFP but it soon-after gave back all the gains. Yet as the day wore on, it slowly climbed back higher and finishes close to 1.3176. Importantly, that’s above the 200-dma at 1.3148.
Cable had a larger pop on payrolls, jumping 120 pips to 1.5680 as stops were hit above 1.5660. Afterwards, the pair went very quiet and it bounced in a 25 pip range around 1.5630. Big offers are up at 1.5700.
There was talk of a sovereign bid in Canadian dollars and it makes sense with a mostly one-way bid in the currency. Naturally, the blockbuster Canadian jobs report didn’t hurt. USD/CAD fell as low as 1.0382 but bounced late to 1.0412.
Have a great weekend!
