Article / 26 May 2016 at 23:45 GMT

US Market Wrap: Mixed US data makes FX markets feisty

FX Consultant / IFXA Ltd


  • Japan:  CPI                                                                                  2300 GMT
US Data released

  • Jobless Claims (Actual 268,000 vs. forecast 275,000)
  • Durable Goods Orders April (Actual 3.4% vs forecast 0.5%, Core 0.4% vs. forecast 0.3%)
  • Pending Home Sales April (Actual 5.1% vs forecast 0.6%)

By Michael O'Neill

FX markets were rather feisty today and the “mixed” US data results were responsible for a lot of the churn. The data headlines were impressive. Durable Goods, Jobless Claims and Pending Home Sales all handily surpassed expectations but then nit-pickers muddied the waters.

The strong headline Durable Goods number was because of a 64.9% jump in aircraft orders but new orders in capital goods were weak, hence the unhappiness.

EURUSD leapt from 1.1155 to 1.1215 on the news, chopped around for the rest of the morning and then closed where it was to start the day. USDJPY dropped from 110.20 to 109.55, tried to bounce and ran out of steam in the 109.75 area. USDCAD was choppy and tracked oil price swings.

The data wasn’t entirely to blame for the FX moves. A very choppy oil market and pre-holiday weekend position adjustments also played a role.
WTI oil prices flirted with $50.00/b in Europe and then consummated the deal in the morning, touching $51.20/b .

That love affair was short lived and within a couple of hours, WTI was down at $49.21. The subsequent bounce failed at $49.70 and WTI closed at $49.33/b.  there wasn't any fresh news to explain the demand.

US equity traders appeared unimpressed with the today's economic data and oil prices.  The major indices closed near flat on the day.

A 64.9% jump in aircraft orders boosted the US Durable Goods number. Photo: iStock


FX markets have been listless but with significant movement writes TradingFloor contributor, Ken Veksler in Sound and fury signifying nothing. Nothing at all

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to engage with Saxo Bank's social trading platform.

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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