USD

 As expected, the U.S. retail sales data printed bleak figures and triggered a dollar selloff. 

The headline figure showed a 0.4% decline instead of the flat reading expected while the core figure also printed a 0.4% drop, worse than the estimated 0.1% decrease. On top of that, the consumer sentiment figure measured by the University of Michigan printed a downturn in confidence as the actual figure slipped from 78.6 to 72.3 in April. Producer price inflation reports from the U.S. also missed expectations. Only the Empire State manufacturing index is due from the U.S. today and another round of weak figures could push the dollar lower. The reading is expected to dip from 9.2 to 7.2 in April, reflecting a slowdown in manufacturing.

EUR

Cyprus is currently undergoing additional challenges with its bailout package as a recently released debt sustainability report showed that the country needs to find an additional 6 billion EUR to weather the potential effects of the ongoing fiscal tightening on economic growth. With no other report due on the euro zone schedule today, markets could stay focused on the updates on Cyprus’ debt situation and possibly sell the euro off if the country shows little to no progress in securing additional funds. The EU and IMF have already said that they’re not willing to provide extra cash, which means that Cyprus is running out of options.

GBP

 The U.K. economic calendar is empty for today as pound traders could brace themselves for the release of British claimant count change data and retail sales later on. At the moment, the pound is benefitting from dollar and yen weakness but fundamentals in the U.K. remain very weak and this could be reflected by this week’s set of economic data.

CHF

 There was hardly any movement from franc pairs lately as USD/CHF and EUR/CHF have simply been reacting to U.S. and euro zone reports. There are no reports on Switzerland’s schedule for today, which suggests quiet trading for these pairs.

JPY

  The Japanese yen has managed to recover some of its previous losses against its major counterparts as the Japanese economy has shown signs of improvement last week. Core machinery orders and tertiary industry activity index have both surprised to the upside and contributed to yen support. The industrial production report also surprised to the upside and boosted the yen in today’s Asian session. Japan is set to print a few more medium-tier reports within the week and more improvements could keep the yen selloff at bay.

Commodity Currencies (AUD, CAD, NZD)

Weak Chinese data have been weighing on the commodity currencies recently as China’s CPI and trade balance have disappointed last week. Earlier today, the Chinese GDP also came in below the consensus, which inspired a massive Aussie selloff. No reports are due from the comdoll economies today, which suggests that the worse than expected Chinese figures could keep their rallies capped.

By Kate Curtis from Trader’s Way