Daily FX Trading Update: Fonterra Downgrade Weighs on NZD – May 15, 2015

Daily FX Trading Update: Fonterra Downgrade Weighs on NZD - May 15, 2015

The US dollar managed to regain a bit of ground in recent FX trading sessions, even though data from the US economy came in mostly weaker than expected. Initial jobless claims were better than expected but the PPI readings indicated that weaker price pressures are to be expected. The headline PPI showed a 0.4% drop instead of the projected 0.1% uptick while the core figure showed a 0.2% decline. For today, the Empire State manufacturing index, preliminary UoM consumer sentiment figure, and the industrial production and capacity utilization reports are due.

The euro extended its climb against its FX trading counterparts despite the lack of data from the economy. European banks were closed for the holiday, leaving traders to take their cues from German bond yields and risk sentiment. For today, there are still no reports lined up from the region.

FX Trading News

The pound was able to sustain its recent FX trading rallies as data from the UK came in better than expected. The RICS house price balance showed a 33% figure, much higher than the projected 22% reading, while the previous report enjoyed an upward revision. UK construction output is due today, along with the leading index. Better than expected data could allow the currency to end the week with strong gains.

The franc managed to regain ground in yesterday’s FX trading sessions even without any help from economic data. The currency followed in the euro’s footsteps and was able to advance against its counterparts. For today, Swiss PPI data is due and a 0.1% decline in producer prices is eyed.

The yen recovered against some of its FX trading rivals as risk appetite faded in recent trading. Earlier today, data from Japan showed a 2.1% decline in producer prices and a decline from 41.7 to 41.5 in consumer confidence. Nonetheless, BOJ Governor Kuroda remained confident that no further stimulus is necessary. No other reports are due from Japan today, leaving the yen sensitive to risk flows again.

The comdolls popped higher at the start of the day, mostly due to upbeat retail sales data from New Zealand, then gave back their gains as risk appetite weakened later on. There have been no reports released from the comdoll economies then while today only has the manufacturing sales report from Canada, which might show a 1.2% rebound.

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.