AUDUSD (0.733): The Australian dollar saw a relatively stronger week as the currency was boosted by an overall modestly positive data. Retail sales for the month grew at a pace of 0.7%, beating estimates of 0.5%. The unemployment rate was however higher rising to 6.3% from 6.1% last month. The main event though was the RBA’s monetary policy which left interest rates unchanged and struck a fairly neutral tone although the RBA noted that it would assess incoming economic data before considering any major policy changes. The Aussie was up 0.5% for the week.
- AIG manufacturing index 50.4 vs. 44.2 previously
- MI Inflation gauge m/m 0.2% vs. 0.1% previously
- HIA new home sales m/m 0.5% vs. -2.3% previously
- ANZ Job advertisements m/m -0.4% vs. 1.2% previously
- Retail sales m/m 0.7% vs. 0.5%
- Trade balance -2.93bn vs. -3.06bn
- RBA leaves cash rate unchanged at 2.0%
- Commodity prices y/y -20.2% vs. -117.1% previously
- Employment changes 38.5k vs. 10.2k; Unemployment rate 6.3% vs. 6.1%
- AIG services index 54.1 vs. 51.2 previously
- AIG construction index 47.1 vs. 46.4 previously
- Home loans 4.4% vs. 5.2%
EURUSD (1.08): The Euro was trading subdued this week losing close to -0.9% against the Greenback. There was not much of market moving economic data for release from Europe this week. Final manufacturing PMI was soft, at 52.4 while services PMI grew to 54. Retail sales remained subdued falling -0.6% for the month. Economic data from Germany was mixed as German factory orders grew 2% for the month beating estimates but industrial production fell -1.4%. French industrial production was also weaker falling -0.1% for the week.
- Final manufacturing PMI 52.4 vs. 52.2
- PPI m/m -0.1% vs. -0.1%
- Final services PMI 54 vs. 53.8
- Retail sales m/m -0.6% vs. -0.1%
- Retail PMI 54.2 vs. 50.4 previously
- German factory orders m/m 2.0% vs. 0.4%
- German industrial production m/m -1.4% vs. 0.3%
- French industrial production m/m -0.1% vs. 0.3%
NZDUSD (0.653): Economic data from New Zealand continued to remain weak with the Global dairy trade index falling -9.3% for the week. There was a lot of unemployment data from New Zealand this week. Quarterly employment change in the country grew 0.3% well below estimates of 0.5% while the monthly unemployment rate fell to 5.9%. The New Zealand labour cost index rose to 0.5% matching expectations. The Kiwi was however weaker falling -0.8% for the week.
- ANZ commodity prices m/m -11.2% vs. -3.1% previously
- GDT price index -9.3% vs. -10.7% previously
- Quarterly employment change 0.3% vs. 0.5%
- Unemployment rate m/m 5.9% vs. 5.9%
- Labor cost index q/q 0.5% vs. 0.5%
USDJPY (124.8): There was not much of economic data from Japan this week, with the exception of the BoJ monetary policy meeting held on Friday. The Central bank left the monetary policy unchanged, leaving the current pace of QQE purchased at 80 trillion Yen. However, going forward, with inflation not inching ahead, many economists are of the view that the BoJ will have to increase its stimulus purchases. Other economic data from Japan this week included the manufacturing PMI which was soft at 51.2, while the average cash earnings fell -2.4% well below estimates of 0.9%. The USDJPY was however lifted by the Nonfarm payrolls data. For the week, USDJPY was up 0.8%
- Final manufacturing PMI 51.2 vs. 51.4
- Monetary base y/y 32.8% vs. 32.2%
- Average cash earnings y/y -2.4% vs. 0.9%
- BoJ leaves monetary policy unchanged
- Leading indicators 107.2% vs. 106.9%
USDCAD (1.31): The Canadian dollar continued to remain weak with the USDCAD gaining 0.65% for the week. Building permits beat estimates rising 14.8% for the month, but the unemployment report showed the Canadian unemployment rate remaining steady at 6.8%. For the month, Canadian economy added 6.6k new jobs beating estimates of 5.3k. However, the CAD was weak following Crude oil prices which resumed the bearish trend.
- Trade balance -0.5bn vs. -2.8bn
- Building permits m/m 14.8% vs. 5.1%
- Employment change 6.6k vs. 5.3k
- Unemployment rate 6.8% vs. 6.8%
GBPUSD (1.545): It was a busy week for the British Pound with lot of important economic releases on the agenda. The monthly PMI’s were mixed with only the manufacturing PMI rising above estimates, while construction and services PMI remained subdued. Manufacturing production was also soft rising 0.2% for the month but industrial production fell -0.4%. The Bank of England met this week and decided to leave the interest rates unchanged. In terms of the vote count for the rate hike, there was only one dissenter which disappointed the markets resulting in the British Pound coming under pressure. GBPUSD was down -0.9% for the week.
- Manufacturing PMI 51.9 vs. 51.6
- Construction PMI 57.1 vs. 58.6
- Services PMI 57.4 vs. 58.1
- Halifax HPI m/m -0.6% vs. 0.5%
- Manufacturing production m/m 0.2% vs. 0.2%
- Industrial production m/m -0.4% vs. 0.1%
- BoE leaves interest rates unchanged at 0.5%
- NIESR GDP estimates 0.7% vs. 0.7% previously
USDCHF (0.987): The Swiss franc remained a mute spectator as the USDCHF surged over 2% this week. Economic data from Switzerland this week included the manufacturing PMI which contracted, falling below the 50 index. Inflation for the month also fell -0.6% weakening the Swiss Franc against a stronger Greenback.
- Manufacturing PMI 48.7 vs. 50.6
- CPI m/m -0.6% vs. -0.4%
- Unemployment rate 3.3% vs. 3.3%
- Foreign currency reserves 531.8 vs. 516.2bn previously
US Dollar Index (98.3): It was a busy week for the US Dollar, but the markets were clearly waiting for the monthly jobs report. Friday’s NFP report showed the US economy added only 215k jobs below the market consensus of 222k. The unemployment rate was steady at 5.3% and the last month’s NFP numbers were revised higher. The jobs report came amidst increasing caution as the ADP private payroll report released earlier in the week saw the US economy adding only 185k jobs well below the estimates. Other economic data from the US included the ISM manufacturing PMI which was soft at 52.7 while factor orders posted a healthy growth of 1.8%. The US Dollar Index gained over 1% for the week.
- Core PCE price index m/m 0.1% vs. 0.1%
- Personal spending m/m 0.2% vs. 0.2%
- Personal income m/m 0.4% vs. 0.4%
- ISM manufacturing PMI 52.7 vs. 53.6
- Final manufacturing PMI 53.8 vs. 53.8
- ISM manufacturing prices 44 vs. 49.5
- Factory orders m/m 1.8% vs. 1.8%
- ADP nonfarm employment change 185k vs. 216k
- Trade balance -43.8bn vs. -42.8bn
- Final services PMI 55.7 vs. 55.2
- ISM non-manufacturing PMI 60.3 vs. 56.3
- Weekly unemployment claims 270k vs. 273k
- Average hourly earnings m/m 0.2% vs. 0.2%; y/y 2.1% vs. 2.3%
- Nonfarm employment change 215k vs. 222k
- Unemployment rate 5.3% vs. 5.3%
