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US GDP Miss Sends USD/JPY, Yields, Futures Lower Ahead of FOMC

By Gregory Marks
30 April 2014 12:47 GMT

Talking Points:

-ADP Employment Change (APR) comes in at 220K vs. 210K estimated

-ADP Employment Change (MAR) revised from 191K to 209K

-US GDP QoQ (1Q A) comes in at 0.1% vs. 1.2% estimated and 2.6% prior

-Canadian GDP MoM (FEB) comes in at 0.2% vs. 0.2% estimated and 0.5% prior

Gross Domestic Product (annualized figures) for the U.S. came in far below market expectations and contributed to USDollar weakness as the NY session gets underway. The quarter over quarter print came in at 0.1% vs. expectations of 1.2%, although Personal Consumption came in higher at 3.0% vs. 2.0% surveyed.

On the Canadian front, we saw a print of 0.2% for MoM GDP growth in February for GDP and this met market expectations. Nevertheless, we saw Industrial Price Product come in slightly lower than expected and the Raw Materials Price Index came in at 0.6% vs. 1.0% expected.

Just before GDP we received the ADP Employment Change print that indicated a 220K gain vs. a 210K estimate for April while the March figures were revised higher to 209K from 191K reported last month. Although 10yr US Treasury yields spiked at the ADP release to 2.715%, we hit a low of 2.674% at the release. Equity futures spiked higher at the GDP release, but 10 minutes following the print we are seeing heavy volume selling as we move towards the open.

Note that we have event risk later in the day with the FOMC Rate Decision at 18:00GMT.

Spread Study: ADP vs. NFP

US GDP Miss Sends USD/JPY, Yields, Futures Lower Ahead of FOMC

April 30, 2014 USDJPY (5-Minute Chart)

US GDP Miss Sends USD/JPY, Yields, Futures Lower Ahead of FOMC

Source: FXCM Marketscope

Gregory Marks, DailyFX Research Team

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30 April 2014 12:47 GMT