News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Indices Update: As of 13:00, these are your best and worst performers based on the London trading schedule: France 40: 0.77% US 500: 0.16% FTSE 100: 0.14% Germany 30: 0.11% Wall Street: 0.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/u03rrXpglC
  • It's FOMC day! Measures of vol have been creeping up the past 48-hours - what does this mean for $DXY, $EURUSD, Gold? We're talking all this and more for the Mid-Week Market Update, starting now: https://www.dailyfx.com/webinars/140187219
  • Bitcoin (BTC/USD) baulks at initial resistance at $41.3k - mkt looks overbought. Second time lucky? #bitcoin #btc @DailyFXTeam https://t.co/KxFqY8gBig
  • 🇨🇦 Core Inflation Rate YoY (JUN) Actual: 2.7% Previous: 2.8% https://www.dailyfx.com/economic-calendar#2021-07-28
  • 🇺🇸 Goods Trade Balance Adv (JUN) Actual: $-91.21B Previous: $-88.16B https://www.dailyfx.com/economic-calendar#2021-07-28
  • 🇨🇦 Inflation Rate MoM (JUN) Actual: 0.3% Expected: 0.4% Previous: 0.5% https://www.dailyfx.com/economic-calendar#2021-07-28
  • 🇨🇦 Inflation Rate YoY (JUN) Actual: 3.1% Expected: 3.2% Previous: 3.6% https://www.dailyfx.com/economic-calendar#2021-07-28
  • Please join @CVecchioFX at 9:30 EST/13:30 GMT for your mid-week markets update webinar. Register here: https://t.co/daghpCQ68Y https://t.co/6VUODFICE4
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 93.51%, while traders in Wall Street are at opposite extremes with 72.71%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/7S61yo1pbV
  • Forex Update: As of 12:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: 0.27% 🇬🇧GBP: -0.03% 🇨🇭CHF: -0.05% 🇳🇿NZD: -0.25% 🇦🇺AUD: -0.26% 🇯🇵JPY: -0.26% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/uc2x6KCUJO
Secondary April US Data Stunts US Dollar Uptrend; USD/JPY Negative on Day

Secondary April US Data Stunts US Dollar Uptrend; USD/JPY Negative on Day

Christopher Vecchio, CFA, Senior Strategist

THE TAKEAWAY: USD Producer Price Index (APR) > -0.7% versus -0.6% expected, from -0.6% (m/m); +0.6% versus +0.8% expected, from +1.1% (y/y) > USD Producer Price Index ex Food & Energy (APR) > +0.1% as expected, from +0.2% (m/m); +1.7% as expected on hold (y/y) > USD Industrial Production (APR) > -0.5% versus -0.2% expected, from +0.3% (revised lower from +0.4%) (m/m) > USD Manufacturing Production (APR) > -0.4% versus +0.1% expected, from -0.3% (revised lower from -0.1%) (m/m) > USDJPY BEARISH

A great deal of second-tier US data was released this morning, and on the whole, it is being perceived as negative for the US economy, and thus, the US Dollar. With at least five significant prints on the docket, volatility was expected to be elevated; but a clean sweep of negative data was unanticipated (the summary can be seen above).

Of note, the divergence in the headline and core Producer Price Index readings looks disconcerting, especially if you look at the world through the lens of “commodity inflation,” that is, rising prices for commodities indicate long-term rising global growth prospects. Thus, seeing the factory side (as opposed to the consumer/retail side) of the price equation come in weaker could indicate – and perhaps the reason why the US Dollar has been hit – that market participants have overestimated the near-term growth momentum of the US economy (the April Industrial Production and Manufacturing reports might agree).

However, something that is being overlooked about the PPI report, which prompted the sell-off: core prices were steady at +1.7% y/y – while the headline m/m figures fell further – as the decline in inflation can be nearly entirely attributable to energy costs. The generic RBOB Gasoline contract fell by -9.95% in April, which fits neatly in with the Advance Retail Sales (APR) report from Monday: if consumers spend less money on energy they can allocate those saved funds to other forms of consumption. In other words, the weak PPI report does not necessarily have deep negative connotations regarding the state of the US economy.

USDJPY 1-minute Chart: May 15, 2013

Secondary_April_US_Data_Stunts_Dollar_Uptrend_USDJPY_Negative_on_Day_body_x0000_i1027.png, Secondary April US Data Stunts US Dollar Uptrend; USD/JPY Negative on Day

Charts Created using Marketscopeprepared by Christopher Vecchio

Leading up to and following the release, the USDJPY fell back from a session high of ¥102.76 to as low as 101.84, before rebound to 102.03 at the time this report was written. Intense pressure was also seen in the USDCHF, having fallen from a session high of Sf0.9747 to as low as 0.9652 following the reports.

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES