Forex headlines for March 27, 2014:
Q4 2013 US GDP final 2.6% vs 2.7% exp
US initial jobless claims 311k vs 325k exp
US February pending home sales -0.8% vs +0.2% exp
Fed’s Pianalto says deflation is still a risk
New Italy budget deficit forecast will be well-below 3%
Fed’s Bullard calls for rate hikes in early 2015
Fed’s Dudley says a better central banking system is needed for global access to liquidity in times of stress
SNB’s Zurbruegg: Value of franc still high
March US Kansas City Fed manufacturing index +10 vs +5 exp
South Africa leaves benchmark rate unchanged at 5.50%
Bloomberg consumer comfort survey falls to six-week low
Three reasons the Draghi shoud undertake QE — from former ECB member Bini Smaghi
Gold down $12 to $1292, below 200-dma
WTI crude up $1.08 to $101.33
S&P 500 down 3 points to 1849
NZD leads, EUR lags
The pound was flying high heading into US trading after upbeat retail sales numbers but after hitting 1.6647 the pair ran into 1.6650 offers. Fixing sales in London began to weigh on the pair late and it was a quick trip down to 1.6602, ahead of bids at the big figure. Last at 1.6610.
The kiwi was the top performer but most of the gains were before the US session, coming on strong trade data. The kiwi hit 0.8686 — breaking last April’s high to the highest since 2011. Last at 0.8672.
It’s turning into a blockbuster week for the Canadian dollar as it gained for the fifth day in a row. Domestic news was near nil (if anything Canadian banks cutting mortgage rates was CAD bearish) but it was a steady trip lower in USD/CAD. The pair ran stops below the mid-March low of 1.1026 and down to 1.1014.
The euro was on the defensive on speculation the ECB could take some action next week. EUR/GBP sellers were also in action after the UK retail sales numbers. Bini Smaghi talking about further action was also a minor factor.
USD/JPY didn’t follow a particular pattern as it chopped from 102.40 at the start of US trading down to 102.00. Stocks were volatile and that explained some of the moves but it was mostly noise. Last at 102.17.
Gold’s inability to hold the 55-day and 100-day moving averages is a big concern. The next level of support is the 50% retracement of the Feb-March rally at $1287.