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Mixed US Data Leaves Markets in Flux

Published September 15, 2016
  • USDCAD tested into the mid 1.3200's overnight before reversing to essentially trade flat around the 1.3200 handle at the time of writing, following a mixed bag of key economic data from the US 
  • Jobless claims for last week came in at 260k, beating expectations for a 265k print and continuing a string of strong reports
  • The Philly Fed Business Index handily beat expectations as well, rising to 12.8 compared with expectations of a 1.0 print; improvement seen across the employment, prices paid, and new orders sub-indices
  • However, the all important Retail Sales data for August fell short of expectations
  • The headline figure fell -0.3% compared with July and -0.2% once auto sales were stripped out
  • US yields initially lurched lower as did the USD index but have since recovered as we await US Industrial Output data for August which comes out at 915am ET
  • The fun doesn't stop there with the US reporting Consumer Sentiment and CPI data on Friday alongside Canadian Manufacturing Sales for July
  • Oil is stable at $43.65 thus far this morning but the outlook for prices wasn't helped by yesterday's inventory data, which highlighted the possibility of lower refinery demand heading into autumn as stocks of gasoline and distillates rose above forecasts

Charts: (1) USDCAD formed a base at 1.2825 and is now set for test of range highs circa 1.3255. (2) Fed Interest Rate Hike Probability. (3) US-CA 2YR Yield Spread. (4) Economic Calendar laden with US data.