New York Session Recap

Daily Forex Fundamentals | Written by Forex.com | Jul 31 08 20:52 GMT |

Despite weaker than expected economic data and a stock market rout the buck held in pretty well against the majors in the NY session. The advance read of US 2Q GDP came in below market expectations at 1.9% from 0.9% in 1Q. The weakness in the automotive sector contributed heavily to the disappointment and excluding autos GDP would have been a very healthy 3.1% for the quarter. Initial jobless claims were a worse than anticipated 448K after a 404K print the prior week and this took the 4-week moving average to 393K from 382K. Statistical quirks seem to be at play here as the first two weeks of the month were relatively low and the last two were on the high side. The government seems to have had trouble adjusting the data to the timing of the typical summer automotive layoffs. Euro shot up against the buck on the weaker news, getting as high as 1.5700 in NY trading after opening around the 1.5610 mark. Better than expected Chicago PMI -- which rose to 50.8 in July from a prior 49.6 -- helped pare gains subsequently. EUR/USD would close near the 1.5600 level. USD/JPY saw a similar knee-jerk reaction to the weak data reports, falling as low as 107.57 after opening the session around the 108.25 mark. The pair would come back some and held in relatively well considering the sharp decline in US stocks towards the latter half session. USD/JPY was sitting near 107.90 as the session came to a close. The buck was bid against its Canadian counterpart as a weaker than expected monthly GDP out of Canada and lower oil prices weighed on the currency. Canada May GDP came in at a paltry -0.1% after a 0.4% expansion in April. Meanwhile, oil fell about $2 in the span to a close just above $124/bbl. This helped boost USD/CAD from an open near 1.0225 to a close around 1.0240. Upcoming Economic Data Releases (Asia Session) Prior Estimate 7/31 23:30 GMT AU AiG Performance of Mfg Index JUL 47 - - 7/31 23:50 GMT JN Loans & Discounts Corp YoY JUN 1.00% - - 8/10:30 GMT AU TD Securities Inflation MoM% JUL 0.50% - - 8/1 0:30 GMT AU TD Securities Inflation YoY% JUL 4.80% - - Forex.com http://www.forex.com DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.