Forex Afternoon Wrap – 23/12

UK third quarter GDP revised down to 0.40%

• US personal spending 0.30% vs. 0.30%
• France consumer spending m/m -1.10% vs. 0.20%
• Swiss KOF economic barometer 96.6 vs. 98.9
• UK Current account -17.5bn vs. -21.3bn
• UK final GDP q/q 0.40% vs. 0.50%; GDP y/y 2.10% vs. 2.30%
• UK Index of services 3m/3m 0.50% vs. 0.60%
• Italy retail sales m/m -0.30% vs. 0.30%; y/y 1.80% vs. 1.70%
• Canada GDP m/m 0.0% vs. 0.20%; y/y -0.2% vs. 0.0%
• Canada retail sales core m/m 0.0% vs. 0.40%; retail sales 0.1% vs. 0.40%
• US durable goods orders 0.0% vs. -0.60%; core durable goods orders -0.10% vs. 0.0%
• US personal income m/m 0.30% vs. 0.20%; personal spending m/m 0.30% vs. 0.30%
• US PCE price index core m/m 0.10%vs. 0.10%
• US PCE price index core y/y 1.30% vs. 1.30%; PCE price index y/y 0.40% vs. 0.40%%

Later

• US New home sales
• UoM Consumer confidence
• US Crude Oil inventories

The markets opened on a quiet note today with Japan being closed for a bank holiday. There was not much of data from the Asian session, but the Aussie and Kiwi were seen trending higher before declining lower from the intraday tops. AUDUSD is down -0.25% for the day after the currency eased back from the intraday top below 0.7249 and is currently trading at 0.721while NZDUSD is posting sharper declines than usual, down -0.50% at the time of writing. NZDUSD touched down to post an intraday low near 0.676

The Japanese Yen continued to trade flat to the US Dollar in early trading with prices mostly moving sideways, trading within the range of 121.1 – 120.7, yesterday’s lows. After the US data was released, USDJPY is down -0.12% at the time of writing.

The European trading session saw the release of the French consumer spending which fell more than expected. The Euro was seen on the back foot in early trading today as the single currency continued to decline steadily. EURUSD is down -0.41% today trading near 1.091 at the time of writing. A break of support at 1.09095 could see the EURUSD decline lower to 1.08675

In the UK, the final revision to the third quarter GDP data was released. Falling below expectations, the UK’s economic growth was revised lower to 0.40% for the quarter, down from 0.50% while the annualized GDP was slashed to 2.10%. The second quarter GDP was also surprisingly cut lower to 0.50% from 0.70%. Simultaneously the UK’s current account deficit data was also released, which showed a lower than expected widening in the deficit to £17.5 billion. The weaker downgrades to the GDP number for the second and third quarter is likely to keep the Bank of England cautious heading into the next quarter. The GBPUSD interestingly did not react much to the news as the Cable was seen to be stable near the lows above 1.4828.

The US trading session saw a major data dump. Durable goods orders for the month come out mixed, with a flat reading on the headline and -0.10% declines on the core against estimates of a flat reading. Personal income managed to edge higher, rising 0.30% while personal income grew at a pace of 0.30% as expected. The US core PCE price index is at 1.30%, unchanged while the headline numbers increased 0.40%.

From Canada, the monthly GDP data showed a flat reading but the GDP showed a contraction of -0.20% annualized. USDCAD is up 0.06% after touching down to a two day low at 1.3899

The remainder of the evening will see the US new home sales and UoM consumer confidence numbers followed by the US Crude oil inventories report.