USD

The US dollar gave up a lot of ground to its major currency counterparts in yesterday’s New York trading session, when the ISM manufacturing PMI came up short of expectations.

The actual figure slipped from 57.0 to 51.3, worse than the expected decline to 56.2. Only the factory orders report is set for release from the US economy today and this might not have such a huge impact on dollar price action.

EUR

The euro had a chance to rebound against the US dollar in yesterday’s trading, taking advantage of the weakness in US data. Data from the euro zone was mixed, as the Spanish manufacturing PMI printed a stronger expansion while the Italian manufacturing PMI missed the mark. Only the Spanish unemployment change report is up for release from the euro zone today and it might show a 21.3K drop in joblessness.

GBP

The pound was a big loser in yesterday’s trading when the UK manufacturing PMI fell short of expectations. The actual figure fell from 57.2 to 56.7 instead of just dipping to the consensus at 57.1. It’s the construction sector’s turn to print the PMI today and another miss might pave the way for a deeper pound selloff.

CHF

The franc made a decent recovery to the dollar in yesterday’s trading as the SVME PMI came in stronger than expected while the previous month’s reading was revised higher. The actual figure climbed from an upgraded 55.0 reading to 56.1, surpassing the consensus at 55.1. There are no reports lined up from Switzerland today so market sentiment might drive price action.

JPY

The yen managed to hold on to some of its recent gains and go for more as risk aversion stayed in the markets and traders lost appetite for the US dollar. The Nikkei closed with nearly a 2% loss for the day, pushing yen pairs lower. There were no major reports released from Japan recently and none are due today, which suggests that risk sentiment could keep directing yen pairs.

Commodity Currencies (AUD, NZD, CAD)

The comdolls tried to hold on to their recent wins to the dollar and make the most of the weak data from the US. AUD/USD rebounded up to the .8800 area prior to today’s RBA interest rate decision but sold off a few hours leading up to the event. Low-tier inflation reports from Canada came in mixed, allowing USD/CAD to stay around its current levels. Also up ahead is the New Zealand quarterly jobs release, which might show a 0.6% gain in hiring and an improvement in the jobless rate from 6.2% to 6.0%.

By Kate Curtis from Trader’s Way