US Dollar (USD)
The Dollar weakened against most majors, rising against the Yen as stronger economic data led to more risk appetite and safety aversion. The ISM manufacturing PMI rose by 48.9 versus 46.4 forecast sending higher yielding assets higher. Construction Spending gained by 0.3% versus -0.5% forecast and Total Vehicle Sales came out better than expected at 11.2M versus 10.1M forecast, giving more proofs the recession is easing. NASDAQ and Dow Jones climbed by 1.52% and 1.25% respectively. The Nasdaq closed above the 2,000 points mark and the S&P 500 managed to strengthen and close above 1000 for the first time since November. Crude oil rose by 2.74% closing at 71.35$ a barrel. Gold (XAU) rose by 0.13% closing at 954.9$ an ounce. Today, Pending Home Sales are expected at 0.8% higher than 0.1% prior. Personal Spending is expected to remain with a 0.3% change and Personal Income is expected to show a drop of -0.9% versus 1.4% prior. Fed's Governor Tarullo will testify today on the bank supervision before the Senate Banking Committee.
The Euro rallied versus the Dollar as risk appetite continued to grow and stronger economic data showed more signs of the recession easing. HSBC the biggest bank in Europe posted a surprising first half net income of 3.35$ billion versus a 600$ million loss expected and stronger than expected Manufacturing PMI in the U.S pumped risk appetite. German Retail sales fell by -1.8% worse than 0.4% forecast and -1.3% prior. The Final Manufacturing PMI was slightly better at 46.3 versus the 46.0 forecast and prior. Overall EUR/USD traded with a low of 1.4206 and with a high of 1.4444. Today, The European PPI is expected to rise by 0.2% versus -0.2% prior.
EUR/USD - Last: 1.4400
British Pound (GBP)
The Pound jumped versus the Dollar reaching a 9 month high as Manufacturing PMI came out better and HSBC posted a net income of 3.35$ Billion versus early estimated of a 600$ Million loss. The Manufacturing PMI came out at 50.8 above the 47.7 forecast and 47.4 prior. Signs of economy stabilization led to a rally in the Pound which was supported by better results in the ISM Manufacturing PMI pushing the Pound higher versus the Dollar and Yen. Overall, GBP/USD traded with a low of 1.6693 and with a high of 1.6986. Today, The Construction PMI is expected at 46 higher than 44.5 prior. Consumer Confidence will also be released today and is expected at 59 higher than the 58 prior.
GBP/USD - Last: 1.6960
Japanese Yen (JPY)
The Yen weakened versus the Dollar and most major currencies as risk appetite continues to grow following better Construction and Manufacturing data in the U.S and stronger Vehicle Sales than expected. The Japanese Monetary Base increased by only 6.1% less than 6.8% forecast and 6.4% prior. Overall USD/JPY traded with a low of 94.57 and with a high of 95.42 and EUR/JPY traded with a low of 134.57 and a high of 137.56. No economic data expected today.
Canadian Dollar (CAD)
The Canadian Dollar extended its gains as Crude price passed 71$ a barrel and risk appetite grew reaching a 10 Month high versus the Dollar. The Canadian Dollar gained following the better than expected economic data lifting demand for higher yielding assets and commodities. Overall, USD/CAD traded with a low of 1.0642 and with a high of 1.0792. No economic data expected today.
USD/CAD - Last: 1.0655