USD

The US dollar returned some of its recent wins when the ISM non-manufacturing PMI’s jobs component and the ADP non-farm employment change hinted at a weaker NFP read.

Although the headline reading rose from 56.9 to 57.4 to reflect stronger industry growth, the jobs index fell from 57.8 to 55.8 to reflect a slowdown. The ADP figure came in at 158K versus 184K and the earlier reading was downgraded. Analysts are expecting to see a 175K increase in hiring for the NFP and a 0.3% uptick in average hourly earnings. 

EUR

The euro enjoyed a strong surge after the ECB minutes revealed that policymakers are indeed looking into policy adjustments, reviving taper talks for the central bank. German and French industrial production numbers are lined up today, along with Italian retail sales and the French trade balance, and strong readings could keep traders bullish on the shared currency. 

GBP

The pound managed to hold on to its recent gains and go for more as another round of hawkish hints boosted rate hike expectations. UK manufacturing production data is due today and a 0.5% gain is eyed, higher than the earlier 0.2% uptick. Industrial production is expected to be up by 0.4%. The Halifax HPI is also due and a 0.2% uptick is expected. 

CHF

The franc also regained ground against its peers as sentiment improved in the European region. Swiss CPI was actually weaker than expected with a 0.1% dip in price levels instead of the projected flat reading. Swiss jobless rate and the SNB foreign currency reserves are lined up today, and a large pickup in the latter could signal central bank intervention. 

JPY

The yen had a mixed performance as it reacted to country-specific flows, giving up ground to European currencies while advancing against comdolls. There were no reports out of the Japanese currency yesterday, although it did draw safe-haven support due to the North Korean ICBM test launch. Japanese average cash earnings and leading indicators are due today. 

Commodity Currencies (AUD, NZD, CAD)

The comdolls returned some of their recent gains as risk appetite took a hit. Australia’s trade balance beat expectations with a higher 2.47B AUD surplus. Crude oil ticked higher on the larger than expected draw of 6.3 million barrels in the EIA report but the Loonie was unable to hold on to its gains when the Canadian trade balance missed estimates. Underlying data did show healthy gains in imports and exports, although energy shipments were still lower. Canada’s jobs report is also due today and a slower gain of 11.4K in hiring is eyed. 

By Kate Curtis from Trader’s Way