EncoreFX’s daily market updates are written by our experienced and professional dealing team.
Busy Week Ahead, Dual Jobs Reports on Friday the Highlight
Published August 2, 2016
Currency markets continue to adjust to last week's middling US economic data which left much to be desired for those bullish on the US economy, rates, and the greenback
An advance reading of Q2 GDP pegged a mere 1.2% growth rate for the US, well below expectations for a 2.6% expansion
Data this week may be able to get USD bulls back on track; however, yesterday's ISM Manufacturing data was in-line at 52.6 for July with the leading new orders index printing at 56.9 and the production index coming in at 54.7, both positive signs
This morning, the US reported that Personal Consumption rose faster than expected with a gain of 0.4% in June compared with the 0.3% forecast
Friday's employment data from the US will be key in determining market expectations of Fed action for the rest of 2016
Jobless claims throughout July trended lower indicating that we could be in store to build on June's massive gain of 287k positions; consensus is for a 180k gain for July with the unemployment rate static at 4.9%
Canada is expected to show a gain of 10k positions for July with the unemployment rate ticking up a notch to 6.9%
As always, watching the participation rates and average earnings will be key in determining the strength of the headline figures
WTI oil prices continued their bearish trend yesterday as front month prices briefly dipped below the $40 mark for the first time since April
Fundamentals remain bearish with inventories of crude at risk of another surge, as drilling for new production rose for the first time this year in July
Summer driving season failed to put a dent in gasoline inventories and thus refinery demand for crude will likely be weak going forward, especially with autumn maintenance season fast approaching
Investments by money managers in crude and refined products show a large net increase in short positions across the oil complex, highlighting that sentiment is overwhelmingly bearish at present
Charts: USDCAD consolidating once again. WTI Oil breaks through key support at its 200 DMA.