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Weekly Forex Wrap Up: July 24, 2015

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AUDUSD (0.727): The Australian dollar continues to trade bearish as the currency lost -1.5% to the Greenback at the time of writing. Economic data from the country was mostly limited to the RBA meeting minutes which showed that the Central bank is likely to hold the rates for a while. The quarterly CPI was soft, rising less than expected to 0.7%, below estimates of 0.8%, while the trimmed mean CPI managed to match estimates, rising 0.6%. For the week, the Aussie attempted to rally but the gains were capped near 0.7435 which saw the currency decline gradually to trade near the lows of 0.7267.

  • RBA releases minutes of the monetary policy
  • MI leading index m/m 0.0% vs. -0.1% previously
  • CPI q/q 0.7% vs. 0.8%; trimmed mean CPI q/q 0.6% vs. 0.6%

EURUSD (1.093): The Euro was back trading to the fundamentals as the Greek uncertainty continues to slowly abate. Germany’s producer price index fell -0.1% for the month after staying flat the month before. This week saw the flash services and manufacturing PMI being released. While France’s flash manufacturing PMI contracted, rising to 49.6, overall, the data failed to miss estimates. The single currency was however trading stronger for the week, gaining 0.9% at the time of writing. The currency attempted to break above 1.10 resistance but failed to do so after posting a weekly low to 1.0814.

  • German PPI m/m -0.1% vs. 0.0%
  • Italy retail sales m/m -0.1% vs. 0.1%
  • Greek government passes the debt reforms votes
  • Spain unemployment rate 22.4% vs. 22.8%
  • France flash manufacturing PMI 49.6 vs. 51.1; flash services PMI 52 vs. 53.9
  • German flash manufacturing PMI 551.5 vs. 52.1; flash services PMI 53.7 vs. 54.1
  • Eurozone flash manufacturing PMI 52.2 vs. 52.5; flash services PMI 53.8 vs. 54.2

NZDUSD (0.656): The RBNS cut interest rates at its meeting this month by 25bps. However, the Kiwi’s reaction was mostly muted as the markets had expected the rate cuts for quite a while. The tone of the RBNZ statement was also less dovish than expected, which was one of the reasons that the Kiwi was actually bullish after the RBNZ cut rates. The markets continue to expect the RBNZ to deliver rate cuts at its next meeting. The Kiwi briefly rose to weekly highs above 0.6675 before reversing the gains, and was up 0.5% for the week.

  • Credit card spending y/y 6.5% vs. 7.2% previously
  • RBNZ cuts interest rates to 3% from 3.25% previously%

USDJPY (123.9): The Yen saw a relatively quiet week with lack of any major fundamentals and no risks of global uncertainty. The BoJ’s minutes showed that the Japanese Central bank remains optimistic that the country will reach its inflation target during the fiscal year of 2016. For the week, the Yen was trading mostly flat as the USDJPY was down -0.06% at the time of writing, after posting weekly highs above 124.3.

  • BoJ releases monetary policy minutes
  • All Industries activity m/m -0.5% vs. -0.5%
  • Flash manufacturing PMI 51.4 vs. 50.5

USDCAD (1.308): The Canadian Dollar was mixed this week as economic data saw the wholesale sales plummet -1%, while at the same time retail sales managed to beat estimates rising 0.9% on the core and 1.0% on the headline. USDCAD gained 0.79% for the week as USDCAD posted new highs to briefly test 1.308.

  • Wholesale sales m/m -1% vs. 0.1%
  • Core Retail sales m/m 0.9% vs. 0.7%
  • Retail sales m/m 1.0% vs. 0.4%

GBPUSD (1.548): The Cable failed to retain its bullish momentum as the British Pound attempted to test last week’s highs near 1.5663 but failed. GBPUSD was down -0.74% for the week to trade near 1.548 at the time of writing. The main economic data this week was the BoE official bank rate votes, which saw the members maintain unanimity for keeping rates steady at 0.5%. It was a stark contrast to the hawkish comments delivered from various BoE members last week, which was surprising. Retail sales also failed to beat estimates, showing a contraction of -0.2%.

  • Rightmove HPI m/m 0.1% vs. 3% previously
  • BoE MPC official bank rate votes 0 – 9
  • Retail sales -0.2% vs. 0.4%

USDCHF (0.961): There were no major releases from Switzerland this week but the Swiss franc was mostly mixed as the currency initially strengthened in the first half of the week only to give up its gains. USDCHF fell from weekly highs at the open near 0.9648 to post weekly lows below 0.9543.

US Dollar Index (97.5): The US Dollar Index was mixed this week as the index initially opened the week on a high note above 98 but failed to keep the gains, which saw the index fall to weekly lows below 97.15. Economic data for the week was mostly positive. The house price index was soft, rising 0.4%, while existing home sales posted a moderate print of 5.49mn above estimates of 5.4mn. The weekly unemployment claims however saw a 40 year low in claims, giving rise to speculations that the next jobs report could most likely be another stellar print.

  • HPI m/m 0.4% vs. 0.5%
  • Existing home sales 5.49mn vs. 5.4mn
  • Weekly unemployment claims 255k vs. 279k
  • CB leading index m/m 0.6% vs. 0.1%
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