United States Dollar:
Second estimate UK GDP data printed in line with market expectations on Wednesday at 0.7%, down on the previous quarter’s reading of 0.9%. GBP/USD fell to a low of 1.5684 on the news, but as the day went on the dollar started to weaken. US core durable goods orders and unemployment claims, released at 1:30pm printed weaker than expected. The durable goods data showed that demand for US business equipment (excluding non-military goods) fell by 1.3% in October. Weaker than forecast new home sales from the States heaped further pressure on the greenback, leading GBP/USD to run towards 1.58. It didn’t quite break the big figure until early this morning at which point it traded to a high of 1.5824. It’s Thanksgiving in the US today and so there’s no data due out from across the pond. There’s no economic data due from the UK either, but with thinner trading conditions we might still see some volatility between now and the end of the week.
Euro:
EUR/USD has traded a fairly quiet range over the past 24 hours. It pushed slowly higher yesterday, partly in reaction to the weaker than expected US data. After trading to a low of 1.2443 during the morning session, it topped out at 1.2529. There wasn’t a great deal of top tier data releases from Europe yesterday, so the focus was more or less on the run of weak US leading indicators. Looking ahead to today, attention will shift to a German inflation numbers and another speech by ECB President Draghi. Meanwhile, OPEC meetings are due to start. There are some estimates and reports that the price of oil might fall below $60 unless the group of countries agree to cut output, so the outcome will be of particular interest to financial markets.
Aussie and Kiwi Dollars:
AUD/USD has recovered overnight. It got a boost from expectation beating Australian CAPEX data which showed that the seasonally adjusted estimate for total new capital expenditure increased by 0.2% vs. forecasts for a drop of 1.7%. AUD/USD traded to a high of .8614 early this morning following the news. NZD/USD has headed in the same direction over the last 12 hours, this despite the release of weaker than expected trade balance. News that the RBNZ did not intervene to sell NZD in October supported a few bids in the kiwi and it traded to a high of .7926 a few hours ago. GBP/AUD and GBP/NZD have drifted lower as a result overnight and they open this morning at 1.8350 and 1.9980 respectively.
Data releases for the next 24 hours:
AUD: Private Sector Credit m/m
EUR: German Prelim CPI m/m, Spanish Flash CPI y/y, German Unemployment Change, M3 Money Supply y/y, Private Loans y/y, ECB President Draghi Speaks, GfK German Consumer Climate
GBP: No data
NZD: ANZ Business Confidence
USD: No data
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