Forex Major Currencies Outlook (July 11, 2017)

The Fed labor market conditions index dipped from 3.3 to 1.5 versus the consensus at 2.5 but still chalked up its 13th consecutive positive reading. Consumer credit also ticked higher to reflect stronger financial confidence. The NFIB small business index and JOLTS job openings data are lined up today, along with final wholesale inventories and FOMC member Brainard's speech. 

EUR 

The euro gave back some of its recent wins to the Aussie and Loonie but managed to hold steady against the rest of its peers. The German trade balance widened from a surplus of 19.7 billion EUR to 20.3 billion EUR and the Sentix investor confidence index dipped from 28.4 to 28.3. Only the Italian industrial production report is due today and a 0.5% rebound is eyed. 

GBP 

The pound had a mixed run as it was stuck in consolidation to the dollar, euro, and yen, weaker against the Aussie and Loonie, but stronger against the Kiwi. There were no reports out of the UK economy yesterday while today saw a 1.2% rebound in the BRC retail sales monitor. MPC members Haldane and Broadbent are set to give testimonies today and hawkish remarks could lift the UK currency. 

CHF 

The franc weakened against most of its major counterparts as risk-taking came into play. There were no major reports out of Switzerland yesterday and none are due today so market sentiment and currency-specific action could push franc pairs around. 

JPY 

The yen was off to a good start but later on returned its gains to its rivals. Economic data from Japan was weaker than expected as core machinery orders slumped by 3.6% instead of posting the estimated 1.7% gain while the current account surplus fell from 1.81 trillion JPY to 1.40 trillion JPY. There are no major reports lined up from Japan today so market sentiment could push yen pairs around. 

Commodity Currencies (AUD, NZD, CAD) 

The comdoll group had a mixed performance, with the Aussie and Loonie raking in gains and the Kiwi giving up ground. The Canadian currency is still enjoying its gains after the strong jobs report last Friday and traders are pricing in an upbeat BOC decision later this week. Meanwhile, the Aussie shrugged off weaker than expected Chinese CPI of 1.5% versus the consensus at 1.6%. Australia's NAB business confidence and home loans data are due next. 

By Kate Curtis from Trader's Way