Forex news for US trading on February 4, 2016:

  • US Dec factory orders -2.9% vs -2.8% expected
  • Kaplan says that while the Fed wants to normalize, it can't be forced
  • SNB's Zurbruegg: We're convinced the Swiss franc is highly valued
  • Fed's Kaplan: He expects oil market to come into balance in early or mid-2017
  • Oil jumps as Russia says Turkey planning to invade Syria
  • US Q4 prelim unit labor costs +4.5% vs +4.3% expected
  • We are not at the lower bound for rates says Carney
  • US initial jobless claims 285K vs 278K est.
  • Carney: There is less than 0.5% slack in the economy
  • Mersch: ECB is closely monitoring wages development in eurozone
  • BOE will note tie their hands over timing of next move says Carney
  • Carney: All MPC believe next likely move in rates is up
  • BOE's Carney: Growth with UK partners is going to remain below past averages
  • US Challenger job cuts Jan yy 41.6% vs -27.6% prev
  • McCafferty spooked by the inflation spectre
  • ECB's Mersch: The uncertainty about the economy is one of the biggest challenges
  • BOE Inflation Report: 2016 growth forecast cut to +2.2% vs +2.5% prev
  • BOE MPC Minutes: Pound weakness due to concerns on global economy
  • Bank of England votes 9-0 to keep interest rates unchanged. EXP 8-1
  • Obama to propose a $10 per barrel tax on oil
  • Oil company says every storage tank available leased, Cushing "pretty full"
  • Saudi Arabia says it would send group troops to Syria if asked by US
  • Venezuela oil minister out with some fresh jawboning
  • This is an economic indicator you never hear about (and it's sending a warning sign)
  • Fed's Kaplan: Sees some slowing in US from global conditions
  • IMF's Lagarde bangs the same old drum on fixing the global economy

Markets:

  • Gold up $13 to $1155
  • WTI crude down 0.51 to $31.76
  • S&P 500 up 3 points to 1915
  • US 10-year yields down 3.5 bps to 1.85%
  • CHF leads, GBP lags

Markets were more settled in US trading but it didn't start out that way. EUR/USD quickly rallied to 1.1238 from 1.1190 at the start of US trading and it felt like 'here we go again'. But the limit of the move came just after the factory orders report and then the market began to retrace and chop. EUR/USD faded back to 1.1160 and finishes near 1.1200.

There was some divergence in different pairs, which suggests the SELL USD!!! phase is over and the market is getting a bit more discerning. USD/JPY, however, was under fairly steady, albeit soft pressure. It started US trading at 117.00 and slowly grinded down to 116.52 and finishes at 116.72. After three days of selling, there was hardly any appetite for a bounce.

Cable was a whippy trade after the BOE. The first headlines sent it to 1.4530 from 1.4660 but then it came all the way back as Carney said the next move will be a hike. A third twist came as the market decided it wasn't sure if that hike was ever going to come and GBP/USD fell to 1.4586 at the close.

A bit of a retracement in the commodity currencies finally hit in US trading. They all remained higher on the day but pared back their gains substantially. USD/CAD was as low as 1.3649 early in the session and finishes a cent higher. That's partly because oil had been higher but finished down.

AUD/USD pulled back to 0.7194 from 0.7240 while NZD/USD was able to hold on to most of its gains.

The Swiss franc caught a bid despite yet-another round of jawboning from the SNB. EUR/CHF started in the US at 1.1180 and fell back to 1.1127.

Gold completed its fifth day of gains as it rallied to $1155.