Daily Forex Review: Weak Data Pushes EUR Lower – July 28, 2014

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Daily Forex Review: Weak Data Pushes EUR Lower - July 28, 2014

Economic data from the US was mostly stronger than expected last Friday, allowing the dollar to keep rallying against its major forex review counterparts. Headline durable goods orders marked a 0.7% gain while the core figure showed an increase of 0.8%, higher than the estimated 0.4% increase in headline durable goods orders and the projected 0.6% rise in the core figure. This also marked a considerable improvement over the flat core figure in the previous month and a recovery in the 0.9% headline decline. US flash services PMI is up for release today and might show a climb from 61.0 to 62.3. Existing home sales is also due.

The euro continued to weaken against most of its forex review counterparts when the German IFO business climate report fell short of expectations. The figure slipped from 109.7 to 108.0 instead of just dipping to the estimated 109.6 reading. GfK German consumer climate made it just above expectations at 9.0 versus 8.9. M3 money supply and private loans data printed stronger than expected results but these were not enough to keep the shared currency supported. There are no reports due from the euro zone today.

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Forex Review and Reports

The pound retreated further on Friday when the preliminary GDP figure failed to impress. The report showed a 0.8% growth figure as expected and same as the pace of expansion in the first quarter. There are no reports up for release from the UK today and the recent shift in bias for the pound might keep weighing on the currency.

The franc followed the euro and weakened to its forex review counterparts last week, as there were no reports to keep the currency supported on Friday. There are still no reports up for release from Switzerland today, which suggests that the franc might take its cue from risk sentiment or euro price action.

The yen had a mixed performance on Friday, as it functioned mostly as a counter currency. It gave up some ground to the dollar but advanced to the euro, Australian dollar, and Kiwi. Inflation reports from Japan were slightly stronger than expected, with the Tokyo core CPI showing a 2.8% reading and the national core CPI showing a 3.3% gain. There are no reports due from Japan today.

The comdolls had a rough patch on Friday, as they mostly weakened to their counterparts. The Kiwi was weighed down by the RBNZ’s decision to pause from its rate hikes and to jawbone their currency, while the Loonie was dragged lower by the switch in BOC rhetoric earlier. There are no reports due from the comdoll economies today so it could be all about risk sentiment driving price action.

To contact the reporter of the story: James Brennan at james@forexminute.com

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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.