US Dollar Index Jumps Above 85.40, Euro Hammered Below 1.28
- US dollar index registered one of the biggest gains, as the Euro and British pound lost the ground.
- New Zealand dollar turned out to be one of the biggest losers of the day with a decline of more than 120 pips.
- US durable goods orders fell by 18.2% in August, 0.2% more than the forecast.
- Italian retail sales decreased by 0.1% in July 2014 with respect to June 2014.
- EURUSD pair traded a touch below the 1.2700 support area earlier during the London session.
US Durable Goods Orders
The US durable goods orders data was released by the US Census Bureau at the start of the NY session. The forecast was slated for a decline of 18% in August 2014, compared to the preceding month. The result was mostly in line with the expectation, as the US durable goods orders fell by 18.2% in August 2014 to $245.4 billion. This was the first decrease in the last three months and that too a substantial one. However, the best part was that the market was already expecting this. Similarly, the US durable goods orders excluding transportations was in line with the expectation, and rose by 0.7%, compared with a decline of 0.7% in July.
The US initial jobless claims were also released around the same time by the US Department of Labor. The market was expecting jobless claims to rise from 280K to 300K in the week ending September 20. However, the outcome was better than expected, as the US jobless claims were 293K, up by 12,000 from the previous week. Moreover, there was a minor revision for the previous week, and was increased from 280K to 281K. The report also mentioned that the advance seasonally adjusted insured unemployment rate was 1.8% this time for the week ending September 13.
London Session Recap
There was no major event scheduled during the London session today. However, there were some nasty moves seen in the pairs like EURUSD, NZDUSD and AUDUSD. One of the main reasons behind the moves was the strength in the US dollar across the board. The ECB president Mario Draghi delivered a speech at a conference at the Bank of Lithuania. This turned out to be a bearish event for the Euro, as he mentioned that the central bank is ready and prepared to do more if the Euro area CPI worsens. The Euro was under pressure immediately, and dived below the 1.2750 level.
Moreover, the Italian trade retail sales report was released by the National Institute of Statistics during the London session. The outcome was not in the favor of the Euro bulls, as the Italian retail sales decreased by 0.1 in July 2014 with respect to June 2014 in the seasonally adjusted terms. When we consider unadjusted seasonally adjusted terms, then it decreased by 1.5% in July 2014.
The EURUSD pair is trading in the bearish territory, and as long as it stays below the 1.2800-20 resistance level more losses cannot be denied.
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UK Nationwide Housing Prices highlighting the value of the houses prices in UK and indicate current movements in the housing market posted an increase of 1% in April, compared to the preceding month.
US dollar continued to weaken against a few currencies and managed to recover some ground against currencies like the Euro and the British Pound
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