US Dollar Nosedives Post Disappointing Jobless Claims Report

US Dollar Nosedives Post Disappointing Jobless Claims Report

By: Ben Myers | Where To Trade | On:23-04-2015 11:59
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Key Highlights

  • US dollar was seen trading lower during the NY session, as the economic releases in the US missed the forecast.

  • In the US, the Manufacturing Purchasing Managers Index (PMI) capturing business conditions in the manufacturing sector released by the Markit Economics declined from 55.7 to 54.2.

  • US Initial Jobless Claims released by the US Department of Labor increased to 320K whereas the market was expecting it to stay at 295K.

  • US number of New Home Sales i.e. is an important measure of housing market conditions released by the US Census Bureau posted a reading of 0.481M in March 2015, compared to the forecast of 0.523M.

Key Releases:

US Initial Jobless Claims (US Dollar)

US Manufacturing PMI (US Dollar)

US New Home Sales (US Dollar)

US initial Jobless Claims

Earlier during the NY session, the Initial Jobless Claims report was released by the US Department of Labor. The market was expecting it to stay in the positive zone in the week ending April 11, as per the advance figure for seasonally adjusted. However, the outcome was a bit lower compared to the forecast, as the US Initial Jobless Claims jumped from 294K to 295K. The report highlighted that the 4-week moving average now stands around the 282,750 level, which is 250 more than compared to the previous week's revised average of 282,500.

The US continuing jobless claims data was also on the lower side, as it came in at 2.325M, up from the last reading of 2.268M. The 4-week moving average now stands around the 2,329,000, which is 32,750 less than the previous week's revised average.

There was one more release lined up in the US, as the Manufacturing Purchasing Managers Index (PMI) capturing business conditions in the manufacturing sector was released by the Markit Economics. The forecast was lined up for a decrease from 55.7 to 55.4 in March 2015. However, the outcome missed the mark, as the Manufacturing Purchasing Managers Index declined to 54.2. This caused a downside reaction in the US dollar and helped the risk correlated currencies.

Market Reaction

The most profitable currency was the Canadian dollar, which gained a lot of ground against the US dollar. The USDCAD pair traded lower below the 1.2150 level during the NY session and looks set for more losses in the near term.

Futures for the Dow Jones Industrial Average edged higher towards 18,085 and the S&P 500 index was up by 5 points to 2,112.

 

Ben Myers

Ben Myers

Success = few pips, thousand times

Ben Myers is one of the most respected and trusted names in the financial trading industry. Following a long and successful career with HSBC, Bank of Ireland and running his own investment firm

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