Forex news for December 3, 2014:
- November 2014 US ISM non-manufacturing PMI 59.3 vs 57.5 exp
- November 2014 US ADP employment report 208k vs 221k exp
- November 2014 US Markit services PMI final 56.2 vs 56.5 exp
- Q3 2014 US non-farm productivity final 2.3% vs 2.4% exp
- Osborne: OBR forecasts UK 2015 GDP +2.4% vs +2.3% prev
- OBR sees 2014 budget deficit at 5.0% of GDP vs 4.9% prev
- Bank of Canada: Sees signs of broadening recovery
- BOC: Output gap appears to be smaller than projected in Oct
- Full text: Bank of Canada statement
- Saudi Arabia feels oil prices could stabilize around $60
- Swedish government announces election
- Fed’s Plosser: Waiting too long to raise rates risks rapid inflation buildup
- Plosser: Data suggests Fed needs to raise now or soon
- Fed’s Brainard: Fed exploring targeting margin requirements
- Gold gains $11 to $1209
- WTI crude up 41-cents to $67.30
- Brent crude down 64-cents to $69.90
- US 10-year yields up 1 bps to 2.28%
- S&P 500 up 8 points to 2075
- CAD leads, NZD lags
USD/JPY charged toward 120.00 despite a soft ADP report (it was leaked early). The market just can’t get enough US dollars with Treasury yields ticking higher and the unstoppable march in the S&P 500. The pair cruised through 119.50 but stalled ahead of the Aug 2007 high momentarily before eventually climbing as high as 119.87. There has been precious little profit taking since the high.
EUR/USD slipped a half-cent to 1.2325 in European trading and held around that level in early US trading but US dollar strength knocked the pair down to 1.2301. Bids at the big figure ahead of the ECB have held up so far and the pair has inched back to 1.1213. The ECB in the day ahead is huge.
Cable was perky with Osborne handing out goods ahead of the May election. GBP/USD steadily marched to 1.5719 before sliding back to 1.5686. Sterling was particular strong on the crosses, especially EUR/GBP.
The Bank of Canada talked about a smaller output gap and that overwhelmed a good ISM non-manufacturing report released at the same time and sent USD/CAD down to 1.1350 from 1.1400. Weakness in oil late in the day wasn’t acute enough to grab the market’s attention.
The Aussie, on the other hand, tracked back toward the post-GDP lows and hit 0.8400 from 0.8445 at the start of US trading. The overnight low of 0.8388 is in focus.