The buck was broadly bid in NY trading as a combination of rising stock prices and falling oil helped prop up the greenback. US stocks rose 2.4% on the day as financials shrugged off the latest round of credit market write-downs and rallied a whopping 7.5%. Meanwhile, oil prices plunged $3.25 in the session to close near $121.80/bbl.
Better than expected economic data out of the US also helped matters. The Case-Shiller home price index fell to a better than expected -15.8% annual rate while consumer confidence rose to 51.9 in July from 51.0 the prior month. The only fly in the ointment in that confidence report was that the labor differential slipped to -16.8 from -15.6, suggesting a likely uptick in the unemployment rate for the month. This helped fuel EUR/USD selling, which closed near 1.5590 after opening around the 1.5730 mark.
USD/JPY was bid as well, but to a lesser extent. The pair opened the session near 107.70 and closed around the 108.10 level. Higher US yields helped here with the 2-year up about 5 bps and the 10-year adding 4 bps on the day. The 108.20/30 area saw good resistance all session and is likely the next trigger for more pronounced gains.
USD/CAD surprisingly ended the session unchanged after an open near the 1.0240 mark. Even lower oil prices could not help the buck extend gains here. The pair rallied as high as 1.0272 before dropping off in the latter half of NY trading.
Upcoming Economic Data Releases (Asia Session) Prior Estimate
- 7/29 23:50 GMT JN Industrial Production (MoM) JUN P 2.80% -1.60%
- 7/30 1:30 GMT AU Building Approvals (MoM) JUN -6.50% 1.00%
- 7/30 3:00 GMT NZ Money Supply M3 YoY JUN 4.90% - -
- 7/30 4:00 GMT JN Vehicle Production (YoY) JUN 6.80% - -
- 7/30 5:00 GMT JN Small Business Confidence JUL 40.7 - -
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