AUDUSD (0.763): The Australian Dollar opened the week near lows of 0.76 and managed to get a boost on RBA’s inaction and a better than expected quarterly GDP data. The fundamentals managed to push the Aussie to weekly highs near 0.77985 but the rally soon fizzled out as retail sales for the month remained flat. Boost by a better than expected data from the US, the Aussie started its descent to trade near the opening price level of 0.76.
- AIG Manufacturing index 52.3 vs. 48 previously
- MI inflation gauge m/m 0.3% vs. 0.3% previously
- Building approvals m/m -4.4% vs. -1.7%
- RBA cash rate unchanged at 2%
- AIG services index 49.6 vs. 49.7 previously
- GDP q/q 0.9% vs. 0.7%
- Retail sales m/m 0% vs. 0.4%
- Trade balance -3.89bn vs. -2.17bn
EURUSD (1.10): EURUSD also opened the week on a subdued note near lows of 1.09 and rallied for the most part of the week led by better than expected flash CPI estimates from the Eurozone and encouraging news regarding Greece debt negotiations. However, sentiment soured early Friday as Greece postponed its IMF payment that was due while negotiations continued. It is understood that Greece officials will make a combined payment on the 30th of June to the IMF, buying them enough time to reach some of agreement with its creditors. EURUSD touched weekly highs to 1.1348 and declined towards 1.10.
- German prelim CPI m/m 0.1% vs. 0%
- Final manufacturing PMI 52.2 vs. 52.3
- CPI flash estimates y/y 0.3% vs. 0.2%; Core CPI y/y 0.9% vs. 0.7%
- PPI m/m -0.1% vs. 0.1%
- Final services PMI 53.8 vs. 53.3
- Retail sales m/m 0.7% vs. 0.7%
- Unemployment rate 11.1% vs. 11.2%
- ECB minimum bid rate 0.05%, unchanged
- Retail PMI 51.4
- German factory orders m/m 1.4% 0.6%
NZDUSD (0.7045): NZDUSD continues to remain one of the weaker currencies as the Kiwi continues to post fresh lows. While opening the week near 0.7089, the Kiwi dollar made a modest rally to 0.719 and promptly declined lower. There was no major economic data releases from New Zealand this week with the exception of the Global Dairy Trade index, which after weeks of showing improvement fell to -4.4%.
- GDT Price index -4.3% vs. -2.2%
- ANZ Commodity prices m/m -4.7% vs. -7.4%
USDJPY (125.62): USDJPY saw another bullish week albeit the momentum showed signs of stalling after briefly rallying above 124.69; USDJPY was trading sideways for the most part of the week. Economic data from Japan was largely positive with a pickup in average earnings index, but it failed to support the Yen. USDJPY broke through the consolidation mid Friday rising above 125.5.
- Capital spending q/y 7.3% vs. -0.1%
- Final manufacturing PMI 50.9 vs. 50.9
- Monetary base y/y 35.6% vs. 34.3%
- Average cash earnings y/y 0.9% vs. 0.4%
- Leading indicators 107/2% vs. 107/3%
USDCAD (1.252): USDCAD was trading within the range for the most part of the week after forming a high and low within 1.2546 and 1.2383. Ivey PMI saw a strong print of 62.3, while the unemployment change also beat estimates by a wide margin, rising 58.9 above estimates of 10.2k. The unemployment rate was largely unchanged at 6.8%. The Loonie was also susceptible to the Oil prices as OPEC meeting convened on Friday which saw the Oil producing nations leave production levels unchanged..
- Trade balance -3bn vs. -2.1bn
- Ivey PMI 62.3 vs. 55.1
- Employment change 58.9k vs. 10.2k
- Unemployment rate 6.8% vs. 6.8%
- Labor productivity q/q -0.1% vs. 0.2%
GBPUSD (1.524): The Pound Sterling was trading relatively stronger in the early part of the week but saw a sharp sell off on a softer services data. The Bank of England left interest rates unchanged but the Pound sterling rallied to post weekly highs above 1.542 but failed to hold on to the gains. The Cable declined back to lows of the week, trading below 1.5258 levels. Late on Friday, the consumer inflation expectations showed a modest increase from 1.9% to 2.2% in the near term.
- Manufacturing PMI 52 vs. 52.7
- Construction PMI 55.9 vs. 55.1
- M4 money supply m/m 0.4% vs. 0.4%
- Mortgage approvals 68k vs. 64k
- Services PMI 56.5 vs. 59.2
- Halifax HPI m/m -0.1% vs. 0.2%
- BoE official bank rate 0.5% unchanged
- Consumer inflation expectations 2.2% vs. 1.9% previously
US Dollar Index (96.55): The US Dollar saw a rather volatile week as the currency index declined from highs near 97.5 to post weekly lows near 94.75 before managing to stabilize near 96.55. Core PCE data was soft, rising only 0.1% below estimates but other economic data such as construction spending rose 2.2%. ISM manufacturing and non-manufacturing data was mixed however. On Wednesday, the ADP private payrolls saw a modest rise of 201k which saw a rather muted reaction from the Greenback, but no doubt raised expectations of a solid print in numbers for the May jobs report. While unemployment rate increased from 5.4% to 5.5%, the participation rate also saw a slight jump, while the US economy added 280k new jobs in the month of May. The strong jobs report on the whole has managed to keep the Greenback well supported, trading near the 96.5 handle.
- Core PCE Price index m/m 0.1% vs. 0.2%
- Personal spending m/m 0% vs. 0.2%
- Personal income m/m 0.4% vs. 0.3%
- ISM manufacturing PMI 52.8 vs. 51.9
- Construction spending m/m 2.2% vs. 0.7%
- ISM manufacturing prices 49.5 vs. 43
- Factory orders m/m -0.4% vs. 0.0%
- ADP nonfarm employment change 201k vs. 198k
- Trade balance -40.9bn vs. -43.9bn
- ISM non-manufacturing PMI 55.7 vs. 57.1
- Weekly unemployment claims 276k vs. 280k
- Revised nonfarm productivity q/q -3.1% vs. -2.8%
- Revised unit labor costs q/q 6.7% vs. 5.8%
- Nonfarm payroll change 280k vs. 222k
- Unemployment rate 5.5% vs. 5.4%
- Average hourly earnings m/m 0.3% vs. 0.2%