Forex Major Currencies Outlook (October 4, 2013)

Data form the US was also mixed, as the initial jobless claims printed a better than expected result but the ISM non-manufacturing PMI came in below consensus. Initial jobless claims were at 308K versus the estimate at 315K while the non-manufacturing PMI fell from 58.6 to 54.4, lower than the consensus at 57.2. For today, there are no reports due from the US as the government shutdown means that the NFP will not be published. 

EUR 

The euro was able to score good wins against its major counterparts in yesterday’s trading, as the victory of Prime Minister Letta still kept the shared currency afloat. During the ECB conference, Governor Draghi was his usual dovish self. However, the euro still seemed to be more affected by the resolution of the political trouble in Italy. For today, only the German PPI is up for release. 

GBP 

The pound lost ground to most of its counterparts in yesterday’s trading, as GBP/USD formed a double top and hinted of a possible selloff. Data came in line with expectations as the services PMI dipped from 60.5 to 60.3, hinting of a slight slowdown in the industry expansion. For today, there are no reports due from the UK. 

JPY 

The yen was able to end higher against most of its currency rivals, except for the euro. There were no major reports released from Japan yesterday as the move was probably a result of profit-taking ahead of today’s BOJ rate statement. No easing measures are expected but the yen might give back its gains when the central bank gives concrete plans on how to keep the economy afloat while the sales tax hike gets implemented. 

CHF 

The franc bounced back against the dollar but chalked up losses to the euro yesterday. There were no reports released from Switzerland, as the franc simply reacted to country-specific data. There are still no reports due from Switzerland today. 

Commodity Currencies (AUD, NZD, CAD) 

The comdolls weakened slightly against the U.S. dollar, as traders probably booked some of their profits as risk appetite waned. The AIG services index in Australia climbed to its six-month high while China’s services sector posted an expansionary figure. There have been no releases from New Zealand and Canada recently, although RBNZ head Graeme Wheeler gave a speech that was a bit more hawkish than expected. 

By Kate Curtis from Trader's Way