Article / 22 September 2016 at 21:49 GMT

US Market Wrap: Dollar claws back some losses

FX Consultant / IFXA Ltd


  • Japan: Nikkei Manufacturing PMI 0030 GMT 

US Data released:

  • Housing Price Index-July (Actual 0.5% versus forecast 0.3% m/m) 
  • Conference Board Leading Indicators-August (Actual -0.2% vs. forecast 0.0%) 
  • Existing Home Sales Change-August (Actual -0.9% vs. forecast 1.1% 

New York traders walked into a weak US dollar. Only the yen and the New Zealand dollar were lower than they were at the end of the previous day. The yen lost ground due to disappointment with the Bank of Japan’s stimulus measures and kiwi dollar was soft because the Reserve Bank of New Zealand hinted that rates would be going lower. But it didn’t last.

By the end of the session, the US dollar had squeaked out gains but wasn’t even close to recouping yesterday’s post-Federal Open Market Committee meeting losses. Traders looked at strong jobless claims data, soft housing reports and a weak leading indicators report and ignored them all.

Crude oil prices remained bid. WTI traded in a $45.70/barrel to $46.50/b range, buoyed by news that Saudi Arabia and Iran met for a second day, in Vienna. The lack of news of an agreement led to some selling in the afternoon.

US equity traders liked the idea of the Federal Reserve on hold and didn’t appear to be concerned with the prospect of a December rate increase. The major indices were all in the green despite news from Nasdaq-listed tech company Yahoo, which said 500 million accounts had been hacked. The incident occurred back in 2014, which may account for the blasé attitude.

 False dawn ... news that representatives from Opec members Saudi Arabia and Iran were meeting helped lift crude, but some selling followed on the lack of news of a deal. Photo: iStock 


The return of inflation could be problematic says TradingFloor contributor, Neil Staines in Tinkering, flattery, and the return of inflation

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to
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– Edited by Robert Ryan

Missed a day? Here’s what we had to say during our Asian session and our regular European Morning Markets, From the Floor and Mid-session Europe.


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