The US dollar was still stuck in consolidation to most of its major forex counterparts, as traders are awaiting the release of the top-tier data later on this week. US pending home sales were stronger than expected as it showed a 3.4% increase versus the estimated 1.0% growth. US CB consumer confidence data is up for release today and it might show an improvement from 82.3 to 82.9, enough to keep the dollar supported throughout the trading day, making money with forex dollar bulls.
The euro moved sideways against the dollar in yesterday’s trading but encountered a bit of weakness when German import prices came in weaker than expected and showed a 0.6% decline, worse than the estimated 0.1% dip. German preliminary CPI is up for release today and another weaker than expected result might increase fears of deflation in the euro region and trigger euro weakness.
The pound edged slightly higher in recent trading despite the lack of major data from the UK economy. UK preliminary GDP data is up for release today and a 0.9% growth figure is eyed, stronger than the previous 0.7% rise. A higher than expected GDP reading might be enough to push GBP/USD past the previous highs around 1.6825.
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Meanwhile, the comdolls sank in recent trading, thanks to the run in risk aversion due to the conflict in Ukraine and Russia. New Zealand trade balance came in line with expectations at 920 million NZD but the previous month’s figure was revised lower, pushing NZD/USD down. There are no reports lined up from the comdoll economies today, except perhaps the speech by BOC Governor Poloz in the US session.
The franc failed to establish a clear direction at the start of the week since there were no major reports lined up from Switzerland. Their schedule is still empty for today, which suggests that USD/CHF movement could hinge on dollar demand and that EUR/CHF action could be dependent on German data.
Japanese banks are on holiday today, which suggests that the yen might see the same amount of weakness from yesterday. Retail sales posted stronger than expected data over the weekend but the Nikkei ended lower for the day as risk aversion weighed on yen pairs.
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