Sep 9: USD corrects after Friday

9 September, 2013

EUR/USD is consolidating in the $1.3160/80 range on Monday. On Friday euro managed to rebound from $1.3100, but as a whole the past week was once again negative for the pair. Cautious ECB’s view on the block’s economy and Fed tapering expectations keep pressuring the single currency. There are no important data releases scheduled for today. GBP/USD is trading a bit higher around $1.5640, but remains below the Friday’s peak at $1.5680.

USD/JPY opened with more than a 60-pip gap up after it lost about 100 pips on Friday. Yen fell as Tokyo’s winning bid to host the 2020 Olympics boosted optimism in Japanese Prime Minister Shinzo Abe’s package of fiscal and monetary policies which tend to debase the national currency. In addition, a report showed the nation’s economy expanded faster than initially estimated: GDP growth in Q2 was revised up from 0.6% to 0.9%. USD/CHF opened with a 10-pip gap up and is now consolidating around 0.9385.  

AUD/USD is trading just under $0.9200 after it tested $0.9167 earlier in Asia. Australian dollar remains close to a 3-week high as data showed China’s exports increased, boosting trade prospects. NZD/USD opened above $0.8000, but is now trading about 20 pips below this level. Kiwi’s correcting after it gained more than 100 pips on Friday. USD/CAD slipped back below the 1.0400 mark today. On Friday the pair formed a strong bearish candle with a low at 1.0380, but closed the day above 1.0400.

On Friday US dollar weakened versus its counterparts as US non-farm payrolls came lower than expected and the market has priced in a solid reading. The Fed is still expected to start tapering QE this month though.


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