Forex news for North American trade on Sept 15, 2021:
- US September Empire manufacturing index 34.3 versus 18.0 estimate
- Canada August CPI +4.1% vs +3.9% expected
- ECB's Lane: PEPP volume isn't an indicator of our monetary policy stance
- EIA weekly oil inventories -6422K vs -3544K expected
- US August industrial production +0.4% vs +0.5% expected
- Kuroda: If necessary, BOJ will further relax monetary policy such as by reducing interest rates
- ECB's Schnabel: We now look for clearer signs of inflation moving towards 2%
- US August import price index -0.3% vs +0.3% expected
- Gold down $12 to $1792
- US 10-year notes up 2.1 bps to 1.300%
- S&P 500 up 38 points to 4480 (+0.8%)
- CAD leads, CHF lags
The theme was more constructive today but you wouldn't know it from the FX market, which was mostly unchanged.
The largest mover was the Canadian dollar as CPI ran ahead of estimates but solidified the case for the BOC to continue tapering. It was also aided by the ongoing rallies in oil and natural gas; the later of which is threatening to wreck havoc on the European recovery.
Other commodity currencies didn't go along for the ride but finished modestly higher on the day, as did GBP which frequently trades in tandem with the commodity bloc.
USD/JPY continued lower on the day but was up from the European lows as 10-year US yield fought their way to 1.30% from 1.27%. The better tone was helped along by the strong Empire number.
Overall though, the equity tail continues to wag the dog. Stocks were in a much better mood today and erased all of yesterday's declines as the dip buyers once again arrived. That was all the more shocking after the terrible China retail sales number.
Tomorrow we get US retail sales and that will have to be solid to keep sentiment positive (but not too solid).