Forex Major Currencies Outlook (Oct 10, 2014)

Initial jobless claims came in at 287K, lower than the expected 291K figure and indicative of improving hiring trends. US import prices data and testimonies from a couple of FOMC members are lined up for today and these might determine if the Greenback could hold on to its current levels.

EUR

The euro resumed weakness in yesterday’s sessions, as ECB Governor Draghi reminded market watchers that they are ready to ease further if needed. He also reiterated that structural changes might be necessary in order to boost growth in the region. German trade balance was weaker than expected as it slipped to 17.5 billion GBP while the French trade balance came in line with expectations.

GBP

The pound suffered a quick selloff after the BOE interest rate statement, although the central bank refrained from making monetary policy changes. Traders might wait for the minutes of the meeting to be released before establishing their pound biases. UK construction output and CB leading index are up for release today and these might drive short-term GBP movement.

CHF

The franc returned some of its recent gains as it followed the euro’s footsteps. There have been no reports released from Switzerland then and none are due today, keeping the franc vulnerable to risk sentiment and possibly euro movement.

JPY

The yen managed to score wins in recent trading sessions as risk appetite remained weak during the Asian session. Japanese data was mixed, with core machinery orders showing better than expected results and preliminary industrial production falling short of expectations. Earlier today, the tertiary industry activity index marked a weaker than expected 0.1% decline while the previous reading was downgraded to show a 0.3% drop. Consumer confidence data is still up for release.

Commodity Currencies (AUD, NZD, CAD)

The comdolls were back in a weak spot yesterday, as most gave up ground to the dollar. Australia’s jobs report showed bleak results, with a 29.7K drop in hiring while home loans showed a sharper than expected 0.9% decline, indicating that a potential housing price bubble may be starting to hurt the industry already. Canadian jobs data is up for release today and it might show an 18.7K rebound in hiring, enough to keep the jobless rate steady at 7.0%.

By Kate Curtis from Trader's Way