The U.S. economy recovered at a quicker pace than most economists expected in the last quarter of 2009, U.S. gross domestic product surged a seasonally adjusted 5.7% annual rate at Q4 of 2009, well above market consensus of 4.5%-4.8% and it is the largest quarterly growth since the third quarter of 2003 at 6.9%, GDP figure has gone up two consecutive quarters rising 2.2%(revised) in Q3 and now 5.7% in Q4 after a year long contraction since Q3 of 2008, this report from the Commerce Department indicated that the GDP of the entire year of 2009 ended with a 2.4% fall.
The greenback rebounded initially against the Japanese yen after the release of better-than-expected data, however, some option-related offers (New York cut) are still noted ahead of 91.00 level.
Earlier, the single currency slipped to multi-month low against the U.S. dollar to as low as 1.3912 earlier today partly due to concerns over Greece and there was no big surprise from Eurozone data, December unemployment rate came in at 10%, slightly better than analysts' consensus of 10.1% whilst the January Flash CPI showed a below market forecast 1% versus 1.2% expectations. Data came out of Swiss beat economists' forecast and the KOF index climbed to 1.77 from previous figure of 1.68 (revised to 1.73) and beat market consensus of 1.71.
The British pound dropped after triggered stops below 1.6100 and 1.6070, cable just slipped to an intra-day low of 1.6054 after the solid U.S. GDP data and more stops below 1.6000 are now in focus.
Elsewhere, Canada also released its GDP data for the month of November which showed the economy expanded faster than expected in November of 2009 at 0.4%, with market forecast at 0.3%, a third straight monthly gain, mainly led by oil, gas and mining sectors together with biggest increase in wholesale trade output in 2 years, there was also an upward revision of the previous month data, from 0.2% to 0.3%. The Canadian dollar rebounded shortly after the data and hovering around 1.060 against the greenback.
Some traders are awaiting the release of January Chicago PMI (forecast at 57) and University of Michigan Consumer Confidence survey (forecast at 73), with the stronger-than-expected GDP data, traders are now positioning for these numbers to beat market consensus as well.