Dollar gains against euro and yen afterin-line U.S. retail sales data: Oct 17, 2016

Market Review - 15/10/2016 02:29All times in GMT  

Dollar gains against euro and yen after in-line U.S. retail sales data

The greenback ended the day higher against majority of its peers on Friday as despite the release of downbeat U.S. consumer confidence, speculation of a 2016 rate hike continued to support the buck.  
  
The preliminary publication of the data for October from the University of Michigan's Consumer Survey Center showed that consumer sentiment unexpectedly declined to 87.9 from 91.2 in September. That was its lowest reading since September 2015.  
  
Versus the Japanese yen, the greenback rose to 104.16 ahead of European open on dlr's broad-based strength before easing. However, renewed buying at 103.94 lifted the pair and price rallied to session high at 104.48 at New York open. Later, the pair pared its gains and retreated to 104.12 after the release of U.S consumer confidence data. The pair briefly fell to 103.80 after Fed Yellen's speech but quickly rebounded.   
  
THe single currency met renewed selling at 1.1060 in Australia and tumbled to 1.1004 in early European morning, then lower to 1.0995 at New York open. Despite a brief recovery to 1.1028 in New York morning after the release of downbeat U.S. data, price later weakened to a fresh 10-week low of 1.0970 ahead of New York close.  
  
The British pound briefly rose to session high at 1.2262 in Asian morning before tumbling to an intra-day low at 1.2168 in early European morning. Later, cable rebounded strongly to 1.2261 at New York open due partly to cross-buying of sterling especially versus euro before falling once more TO 1.2172 near friday's close..  
  
In other news, BoE's Carney said 'uncertainty is high enough that it is affecting UK economy; UK economy has been broadly consistent with expectations; exchange rate does matter for inflation; we do take exchange rate into account in setting monetary policy; we're not going to have some magic number to watch for with exchange rate.'  
  
Data to be release next week:  
  
Japan industrial production, capacity utilization, Italy trade balance, Eurozone inflation, U.K. Rightmove house price, U.S. NY Empire State Manufacturing Index, industrial output, capacity utilization and manufacturing output on Monday.  
  
New Zealand CPI, U.K. CPI, retail price, producer price index, house price index, U.S. CPI, Redbook, house market index, TIC flows and Canada manufacturing on Tuesday.  
  
China industrial output, retail sales, GDP, Australia CB leading index, U.K. claimant count unemployment change, unemployment rate, average earnings, mortgage applications, building permits, U.S. housing starts and Canada rate decision on Wednesday.  
  
Australia employment change, participation rate, unemployment rate, business confidence, Germany producer prices, Swiss imports, exports, trade balance, Eurozone current account, refinancing rate, deposit rate, U.K. retail sales, U.S. initial jobless claims, Philadelphia Fed manufacturing survey, existing home sales and leading index change on Thursday.  
  
Japan all industry activity, U.K. public sector net borrowing, Eurozone consumer confidence, Canada CPI and retail sales on Friday.