Forex Major Currencies Outlook (September 25, 2013)

The CB consumer confidence figure also came in slightly weaker than expected at 79.7 instead of the estimated 79.9 reading, reflecting lower confidence for the month. Durable goods orders data are up for release today and improvements are expected, which might allow the dollar to keep up its rallies. 

EUR 

The euro lost ground to most of its major counterparts in yesterday’s trading, as Germany’s Ifo business climate report fell short of expectations. The actual reading climbed from 107.6 to 107.7, lower than the estimate at 108.4. German GfK consumer climate data is up for release today and another disappointment might be in the cards, although the reading is slated to rise from 6.9 to 7.1. 

GBP 

The pound was weaker against most of its major rivals, except for the euro. BBA mortgage approvals showed an improvement and reached its highest level since December 2009 at 38.2K. This reflects a healthy level of loan demand, which is good for the housing sector and construction industry. BOE officials expressed their contentment with the current level of stimulus while some mentioned that tightening could take place if significant improvements are seen. UK CBI realized sales are up for release today and a dip from 27 to 24 is expected. 

CHF 

The franc was stuck in consolidation against the US dollar, as USD/CHF was having trouble breaking below the .9100 major psychological support. There were no major reports released from Switzerland then but today’s UBS consumption indicator might be a catalyst for a breakout. The July figure came in at 1.41 and a higher reading might push USD/CHF lower. 

JPY

The yen continued to rally against the other major currencies yesterday, as USD/JPY was able to stay safely below the 99.00 handle. There were no reports released from Japan as risk was off in the markets. There are no reports due from Japan today as we could see yen pairs continue to react to risk sentiment. 

Commodity Currencies (AUD, NZD, CAD)

The Aussie and Kiwi were the weakest performers in yesterday’s trading, as both higher-yielding currencies were hit by risk aversion. USD/CAD managed to hold on to the 1.0300 handle, even though Canadian core retail sales came in strong at 1.0%. For today, there are no major reports due from any of these comdoll economies so these pairs might be sensitive to risk flows. 

By Kate Curtis from Trader's Way