Weekly Forex Wrap Up: 24/12, 2015

AUDUSD (0.71): Data from Australia this week was limited to the CB leading index which continued to decline -0.10% for the month. The Australian dollar was however stronger over the week, with weekly gains of 1.34%. AUDUSD closed the week near last week’s highs of 0.7272 in a strong weekly uptrend lifting off steadily after closing near a 5-week low last week at 0.71.

• CB Leading index m/m -0.10% vs. -0.10% previously

EURUSD (1.09): The Euro, single currency was trading rather flat over the week but managed to close the week near the previous highs of 1.095. Trading was flat with this week’s price action staying within last week’s highs and lows. Data from the Eurozone included weak German PPI numbers, which fell -0.20% for the month while consumer confidence was -6 matching expectations. Germany’s import prices declined -0.20% against expectations of a 0.20% increase.

• German PPI m/m -0.20% vs. -0.20%
• Eurozone consumer confidence -6 vs. -6
• German import prices m/m -0.20% vs. 0.20%
• Gfk consumer climate 9.4 vs. 9.3
• French consumer spending m/m -1.10% vs. 0.20%
• Italy retail sales -0.30% vs. 0.30%

NZDUSD (0.68): The Kiwi is up for another week, with gains of 1.58%. Prices closed near a 10-week high of 0.6838 in a straight fourth week of gains. There were no major fundamentals supporting the Kiwi’s rally with data from New Zealand this week limited to credit card spending which increased from 7.80% previously to 8.50% while the Kiwi trade balanced declined -779 million. The Kiwi continues to remain as the strongest commodity risk currency among its peers.

• Credit card spending y/y 8.50% vs. 7.80% previously
• Trade balance -779Mn vs. -812Mn

USDJPY (120.2): The Yen closed this week with strong gains as USDJPY fell -0.81%. Prices touched an 8-week low with USDJPY closing out the week at 120.28. Data from Japan included the BoJ monetary policy meeting minutes which showed that the Central Bank remains optimistic on reaching its inflation target. However the minutes had a limited impact considering that the minutes were from before the previous BoJ meeting where a modest QE was announced. On Friday, data from Japan saw the BoJ’s core CPI staying put at 1.20% while the unemployment rate failed to meet expectations, rising 3.3%.

• All industries activity m/m 1.0% vs. 0.90%
• BoJ releases monetary policy meeting minutes
• Household spending y/y -2.90% vs. -2.10%
• Tokyo core CPI y/y 0.10% vs. 0.10%
• National core CPI y/y 0.10% vs. 0.00%
• Unemployment rate 3.3% vs. 3.2%
• SPPI y/y 0.20% vs. 0.40%
• BoJ Core CPI y/y 1.20% vs. 1.20%
• Housing starts y/y 1.70% vs. 0.90%

USDCAD (1.38): USDCAD closed the week with a modest pullback, down -0.66% after prices briefly traded near last week’s high of 1.39. The Canadian dollar however remains weak with data showing a nearly flat retail sales numbers while the monthly GDP was flat as well. The Canadian dollar continues to track the Oil prices closed which saw a bullish week.

• Core retail sales m/m 0.0% vs. -0.40%
• GDP m/m 0.0% vs. -0.50%
• Retail sales m/m 0.10% vs. -0.40%

GBPUSD (1.49): The British Pound managed to close the week with modest gains of 0.06% but not before prices touched April lows of 1.4835. Data from the UK over the week included the final revised third quarter GDP numbers which showed the UK’s economy growing at a pace of 0.40% falling short of a 0.50% expectations. The previous, second quarter’s GDP was also revised lower to 0.60%, from 0.70% previously. The weaker than expected numbers is likely to keep the BoE on a dovish note in the upcoming monetary policy meetings.

• CBI realized sales 19 vs. 22
• Gfk consumer confidence 2 vs. 1
• Public sector net borrowing 13.6bn vs. 11.9bn
• Current account -17.5bn vs. -21.3bn
• Final GDP q/q 0.40% vs. 0.50%
• Index of services 3m/3m 0.50% vs. 0.60%
• Revised business investment q/q 2.2% vs. 2.2%

USDCHF (0.98): The USDCHF closed the week with -0.52% losses as the currency pair was trading mostly within last week’s range. Prices attempted to post a weekly high early on above 0.994 but gave back the gains. The declines come about just after USDCHF touched the highs of 1.03 three weeks ago.

• Trade balance 3.14bn vs. 3.82bn
• KOF Economic barometer 96.6 vs. 98.9

US Dollar Index (98): The US Dollar closed out the week declining -0.70% at 98.01. Prices remained choppy during the week and trading was limited to the last week’s range. Data from the US over the week included the final revised GDP which was recorded at 2.0% against expectations of a fall to 1.90%. Overall, data from the US was mixed with existing and new home sales rising less than expected while durable goods orders barely managed to meet estimates.

• Final GDP q/q 2.0% vs. 1.90%
• Final GDP price index q/q 1.30% vs. 1.30%
• HPI m/m 0.50% vs. 0.40%
• Existing home sales 4.76mn vs. 5.32mn
• Richmond manufacturing index 6 vs. -1
• Personal spending m/m 0.30% vs. 0.30%
• Core durable goods orders m/m -0.10% vs. 0.10%
• Durable goods orders m/m 0.0% vs. -0.60%
• Core PCE price index m/m 0.10% vs. 0.10%
• Personal income m/m 0.30% vs. 0.20%
• New home sales 490k vs. 507k
• Revised UoM consumer sentiment 92.6 vs. 92.1 previously
• Revised UoM inflation expectations 2.60% vs. 2.60% previously
• Weekly unemployment claims 267k vs. 270k