19 May 2016 at 23:57 GMT
US Data Released:
- Jobless Claims (Actual 278,000 vs. forecast 275,000)
- Philadelphia Fed Survey (Actual -1.8 vs forecast 3.5)
- Conference board \leading \indicators (Actual 0.6% vs. forecast 04%)
The FX markets were a tad noisy today, dealing with the fall-out from the hawkish Federal Open Market Committee minutes. Perennial hawk, the New York Federal Reserve president William Dudley, added his voice to the June/July chorus. According to the Wall Street Journal, he said “If I’m convinced my forecast is sort of on track, then I think a tightening in the summer, in the June-July time frame, is a reasonable expectation.”
Still, traders were sceptical. Although the US dollar closed with modest gains against the euro and sterling, it was well off its best levels.
If the FOMC is to be believed and rate hikes are data dependent, today's US data didn't help or harm the case.
Oil prices declined in the morning and rebounded in the afternoon. Prices appear to be holding in well despite large pools of crude in storage or in tankers offsetting expectations of higher levels due to supply interruptions. WTI bottomed out at $46.71 and closed at $48.25.
The prospect of higher US interest rates weighed on equities pushing the major New York indices into the red, where they closed.
On Hawkish ground: William Dudley says a summer hike is 'reasonable'. Photo: Flickr
The FOMC is just data dependent but equity and china dependent as well according to TradingFloor contributor, Neil Staines in:The Goldilocks antithesis
-- Edited by Adam Courtenay
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.