USD

The US dollar returned its recent gains when US traders came back from their Labor Day holiday, possibly reacting to the bleak NFP release last Friday. 

Data from the US showed small improvements, with the NFIB small business index improving from 95.4 to 95.9 and the labor market conditions index rising from 1.8 to 2.1. For today, only the JOLTS job openings report is up for release and a rise from 5.25M to 5.30M is eyed.

EUR

The euro edged slightly higher in recent trading, barely able to take advantage of dollar weakness because of the dovish ECB rhetoric. Data from the euro zone was mixed, as Germany reported a larger trade surplus while France printed a wider deficit. There are no reports lined up from the euro zone today.

GBP

The pound was able to bounce back to action in recent trading sessions, despite the lack of top-tier data from the UK yesterday. Today still has an empty economic calendar, which suggests that the British currency might take its cue from risk sentiment.

CHF

The franc scored small gains in recent trading, as the Swiss jobless rate simply came in line with expectations and held steady at 3.3%. There are no reports due from the Swiss economy today, which means that a bit of consolidation might be seen.

JPY

The yen gave up ground in yesterday’s trading sessions when risk appetite appeared to improve in the markets. Data from Japan was mostly stronger than expected, with the GDP revised to show a smaller contraction for Q2 and the current account balance revealing a wider surplus. However, the Economy Watchers sentiment index dipped from 51.6 to 49.3, reflecting pessimism. Consumer confidence and preliminary machine tool orders data are due today.

Commodity Currencies (AUD, NZD, CAD)

The comdolls staged strong rebounds yesterday, as commodity prices and risk appetite picked up. Australia’s NAB business confidence index slumped from 4 to 1 in August, reflecting a downturn in optimism, while China’s trade balance indicated large declines in both imports and exports. Earlier today, Australia printed its Westpac consumer confidence index and showed a 5.6% drop. Later today, the BOC and RBNZ interest rate decisions are lined up, with the latter expected to cut rates and the former likely to stand pat.

By Kate Curtis from Trader’s Way