Forex Fundamentals Update (March 11, 2014)

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Forex Fundamentals Update (March 11, 2014)

The US dollar had a mixed performance in recent trading, as data was relatively light in the Monday forex sessions. For now, it appears that the safe-haven currency is supported by fundamentals, as the recent jobs release came in stronger than expected and indicated a possible recovery in the labor market. Data due in today’s New York trading session are the JOLTS job openings and the NFIB small business index, both of which aren’t likely to spark huge moves for the US dollar.

As for the euro, the shared currency took a break from its strong surge in the previous week and earlier this week. Data from the region has been mostly weaker than expected, with France reporting a weaker than expected industrial production figure and the euro zone Sentix investor confidence reading falling short of consensus. Italian industrial production, on the other hand, printed a better than expected 1.0% increase and showed an upgrade in the previous month’s figure.

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Forex Fundamental Outlook

The pound made a huge retreat in today’s early Asian session when the BRC retail sales monitor chalked up a considerable 1.0% decline, erasing part of the 3.9% increase seen in the previous period. Up ahead, the UK has its inflation report hearings due and the manufacturing production data. The latter could show a 0.3% reading but a stronger than expected figure might trigger a quick bounce for GBP/USD.

The Swiss franc also retreated from its recent gains, as the retail sales report turned out to be a disappointment. It printed a mere 0.3% uptick when analysts were expecting to see a 2.7% jump. The previous figure was revised higher to 2.5% though, still indicating that consumer spending stayed afloat recently.

Meanwhile, yen pairs are in consolidation as traders await the BOJ interest rate decision. Policymakers aren’t likely to announce major changes but their rhetoric regarding the recent weakness in the Japanese export industry and the upcomng sales tax increase is likely to dictate the direction of the Japanese yen in today’s trading.

To contact the reporter of the story: Jonathan Millet at john@forexminute.com