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.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
US Dollar Surges as GDP Beats Ahead of Fed Meeting; USD/JPY New Highs

US Dollar Surges as GDP Beats Ahead of Fed Meeting; USD/JPY New Highs

Christopher Vecchio, CFA, Senior Strategist

THE TAKEAWAY: US economy has been growing faster than expected > 1Q’13 revised down, but 2Q’13 beats expectations – the economy is now seen as expanding, not contracting > USDJPY BULLISH

The US Dollar has extended its gains this morning on the back of a stronger than anticipated 2Q’13 US GDP report, alongside several other revisions that saw growth come in higher than previously reported over the past several years. The +1.7% annualized reading, in context of the now +0.1% 4Q’12 print and +1.1% 1Q’13 GDP print, shows that the US economy’s growth is accelerating despite fiscal headwinds.

Here are the key figures driving US Dollar strength ahead of the US cash equity open:

- GDP (2Q A) (Annualized): +1.7% versus +1.0% expected, from +1.1% (revised lower from +1.8%)

- Personal Consumption (2Q A): +1.8% versus +1.6% expected, from +2.3% (revised lower from +2.6%) (y/y)

- GDP Price Index (2Q A): +0.7% versus +1.0% expected, from +1.3% (revised higher from +1.2%) (y/y)

- Average GDP growth from 2009 to 2012: +2.4% (revised higher from +2.1%)

USDJPY 1-minute Chart: July 31, 2013

US_Dollar_Surges_After_2Q13_GDP_Bests_Estimates_USDJPY_at_Highs_body_x0000_i1027.png, US Dollar Surges as GDP Beats Ahead of Fed Meeting; USD/JPY New Highs

Charts Created using Marketscopeprepared by Christopher Vecchio

Following the release, the USDJPY, already boosted by the beat on the July ADP jobs report, rallied from ¥98.13 to as high as 98.52, a fresh session high and highest level of the week. The pair remains well-bid from just an hour earlier in the session, when the USDJPY was near the lows under 97.60.

Volatility around the Fed release later today will be high and thus the gains seen this morning may or may not be sustained. Currency Analyst David Song has detailed his outlook for the FOMC later today, while Chief Currency Strategist John Kicklighter will be hosting a webinar in DailyFX Plus at 13:45 EDT/17:45 GMT to cover the event.

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail

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.