USD

The US dollar lost ground to most of its major counterparts on Friday’s New York session, as the retail sales report printed weaker than expected results. 

The headline figure showed a mere 0.2% uptick instead of the estimated 0.5% increase while the core version of the report showed a 0.1% rise. Headline PPI was better than expected at 0.3% while the core PPI printed a flat reading. Meanwhile, the consumer sentiment report also turned out to be a disappointment as confidence fell from 82.1 to 76.8. For today, US capacity utilization and industrial production data are due, along with the release of the Empire State manufacturing index. 

EUR

The euro was unable to stay afloat on Friday as downbeat remarks from Draghi weighed on the shared currency. However, EUR/USD opened higher for this week as doubts on the Septaper triggered dollar weakness. Another speech by Draghi is scheduled for today but this might not have such a huge impact on the euro anymore. Italian trade balance and euro zone CPI are up for release and inflation is expected to be at 1.3% for the headline figure and 1.1% for the core figure. 

GBP

The pound struggled to hold on to its recent gains against the dollar and yen last Friday, as there were no new reports from the UK to lift it higher. There are no reports from the UK today as well so pound trading could be range-bound. Take note though that the US is set to print a few medium-tier reports and disappointing results might push GBP/USD higher. 

CHF

The franc packed in more gains against the dollar on Friday, as it took advantage of the weaker than expected US retail sales data. There have been no reports from Switzerland then and none are due today, which means that USD/CHF could continue to depend on US figures. 

JPY

The yen was able to rebound strongly on Friday as the Japanese Cabinet upgraded its growth forecasts for the economy, citing that Japan’s recovery is already picking up. Although they mentioned that there are still several weak areas, additional stimulus from the BOJ could be enough to keep the economy afloat. Japanese banks are on holiday today, which paves the way for volatile movement among yen pairs. 

Commodity Currencies (AUD, NZD, CAD)

Commodity currencies took advantage of dollar weakness on Friday and today, after the US economy showed weak consumer spending data. New Zealand recently reported a bounce in house prices but a weaker Westpac consumer sentiment figure. No reports are due from Australia and New Zealand for the rest of the day while Canada has its foreign securities purchases data up for release in the US session. 

By Kate Curtis from Trader’s Way