USD

The US dollar lost some of its shine in yesterday’s trading when the US ISM manufacturing PMI fell short of consensus.

The actual figure dropped from 53.9 to 53.0 instead of improving to the estimated 54.6 reading. Factory orders, on the other hand, posted a 1.8% rebound as expected while the previous figure was revised to show a smaller decline. Up ahead, the US has its trade balance on tap and a smaller deficit of 40.2 billion USD is expected from the previous 40.6 billion USD shortfall.

EUR

The euro gave up more ground to the dollar in yesterday’s trading as services PMI came in mixed. Italy showed a weaker than expected reading of 47.9 instead of the estimated 48.9 reading but it was still an improvement from the previous 47.2. Spain showed a better than expected 54.2 reading, up from the previous 51.5 figure. German CPI came in line with consensus of a 0.4% uptick. For today, German retail sales and unemployment change data are up for release. Retail sales could rebound by 0.5% from the previous 0.8% decline while unemployment could decline by 1K.

GBP

The pound dipped lower in yesterday’s trading as UK services PMI fell short of expectations. The figure slipped from 60.0 to 58.8 instead of improving to the projected 60.4 reading. The services sector accounts for a huge chunk of growth in the UK economy so a slower expansion could be hinting at weaker GDP later on. For today though, there are no major reports due from the UK as traders brace themselves for the BOE interest rate decision later on in the week.

CHF The franc lost further ground in yesterday’s trading as there were no major reports from Switzerland to give it a boost. Today could be more of the same story, as the foreign currency reserves report is the only one on tap. This doesn’t normally have a huge impact on franc movement, unless the actual figure comes in way off expectations.

JPY

The yen was able to flex its muscles in yesterday’s trading when the Nikkei stock index showed some declines. There were no reports released from Japan then but the Nikkei survey over the weekend led to weaker business confidence, which then boosted the safe-haven yen. For today, there are no major reports lined up from Japan so market sentiment might be a bigger mover for the yen.

Commodity Currencies (AUD, NZD, CAD)

The comdolls drew a bit of support in yesterday’s trading, despite the lack of major reports from Australia, Canada, or New Zealand. Earlier today, Australia’s trade balance came in better than expected at -0.12 billion AUD versus the estimated 0.30 billion shortfall while the previous figure was revised to show a smaller deficit. Up ahead, Canada has the Ivey PMI report on tap and an improvement from 53.7 to 55.0 is expected.

By Kate Curtis from Trader’s Way