USD

Data from the US economy was weaker than expected yesterday, as the flash services PMI held steady at 61.0 instead of improving to the expected 62.3 reading.

Pending home sales fell by 1.1% instead of just 0.2%, erasing part of the 6.0% gain in the previous month. US CB consumer confidence and S&P/CS composite house price index are due today and small improvements are expected. However, if the actual data misses expectations, the US dollar could be forced to return some of its recent gains.

EUR

The euro fought to hold on to its current levels against the dollar as there were no major reports released from the euro zone yesterday. Only German import prices data is up for release today and it might show a 0.3% uptick from the previous flat reading. A higher than expected figure could give a small boost for the euro as it would reveal a pickup in inflationary pressures.

GBP

The pound managed a small rebound in recent trading, despite the lack of data from the United Kingdom. Net lending to individuals and mortgage approvals data are up for release today and strong data could give more fuel to the pound’s fire. Recall that housing and debt levels have been closely monitored by the UK government and the BOE so any improvements could lead to a more positive outlook and renew rate hike expectations.

CHF

The franc moved sideways to the dollar in recent trading, as there were no major reports released from Switzerland yesterday. There are still no reports up for release today, which suggests that the franc could act more as a counter currency in the next few hours.

JPY

The yen returned some of its recent wins when today’s set of releases missed expectations. Retail sales fell by 0.6% on an annualized basis, worse than the estimated 0.4% drop, while the unemployment rate climbed from 3.5% to 3.7% instead of holding steady. Household spending marked a 3.0% drop, not as bad as the projected 3.7% decline.  No other reports are up for release from Japan for the rest of the day.

Commodity Currencies (AUD, NZD, CAD)

The comdolls retreated once more, as there were no reports to support risk taking yesterday. News of a potential default in Argentina also weighed on market sentiment. In Australia, HIA new sales picked up by 1.2% from the previous 4.3% decline. New Zealand building consents data is up for release in the next Asian trading session.

By Kate Curtis from Trader’s Way