Major currencies were mostly range-bound in a relatively quiet session due to a light news flow and few data releases.
The UK published the CBI industrial orders expectations data for June, which rose to +16 versus an expectation for a fall to +7 from a reading of +9. This was the highest number in 30 years, reflecting strength across most sectors of the economy. A weaker pound since the Brexit vote has helped. Meanwhile, UK Prime Minister Theresa May went to Brussels today for the EU Summit, where she will talk about the rights of EU citizens after the UK leaves the EU. However, any detailed Brexit-related discussion with EU leaders is discouraged during the Summit.
Sterling was barely impacted by today’s data and was trading slightly below $1.2700, consolidating gains made after rising on hawkish comments by Bank of England policymaker Andrew Haldane on Thursday.
From the US, weekly unemployment claims figures and April’s housing price index (HPI) data were out. Initial jobless claims rose by 3000, to 241,000 for the week ending June 17, versus a rise of 2,000 to 240,000 that was expected. The prior week’s claims were revised higher to 238,000. HPI rose 0.7% versus a 0.5% rise expected. The dollar was trading above the 111-yen level in the later half of the European session.
Canada reported April retail sales data which boosted the loonie, helping offset some of the weakness from the drop in crude oil prices recently. Retail sales beat on both the headline and core numbers, which would be good news for the Bank of Canada. Headline sales in April rose by 0.8% month-on-month versus 0.3% expected. However, the prior month was revised down to show a 0.5% gain from a prior 0.7%. The core figure was strong and was up +1.5% month-on-month, more than twice that of the 0.7% forecast. Focus shifts to Friday’s CPI data which will be more important for the BoC’s outlook. USD/CAD fell after the data from C$1.3300 to $1.32166.
The kiwi extended gains following the RBNZ’s positive outlook on the economy at its policy meeting today. NZDUSD rose to as high as $0.7272 during the European session.
In commodities, spot gold bounced higher to $1254 an ounce, while oil prices made some recovery today, halting a 3-day decline that took WTI crude to $42.05 a barrel on Wednesday as investors were concerned about a supply glut.
