Forex Today: Aussie gains on jobs report, Chinese data disappoint; BoE decision and US CPI hold key
On Thursday, the US Dollar held on to its overnight strong gains led by renewed optimism over the US President Donald Trump's pro-growth economic policies. The news that a new US tax plan outline would be announced by the end of this month overshadowed disappointing US data, showing producer price inflation increased less than expected in August, and provided an additional boost to the greenback's ongoing recovery move.
US PPI's miss reviewed - Nomura
Analysts at Nomura explained that the headline PPI increased modestly by 0.2% m-o-m in August, lower than the consensus forecast of a 0.3% gain.
Main topics in Asia
Trump: a new framework for tax legislation in about two weeks - ANZ
Analysts at ANZ explained that the Trump administration officials have announced that they expect to have a new framework for tax legislation in about two weeks – cutting it rather fine if the aim is to pass legislation this year.
In some notable moves during Asian session on Thursday, the AUD/USD pair snapped three consecutive days of losing streak after surprisingly stronger-than-expected Australian jobs report for August, which to some extent got negated by disappointing Chinese macro data and capped any further up-move.
Australia August employment data blows past expectations
The official data released this Thursday morning showed the Australian economy added far more jobs in August than expected.
AUD/USD surges through 0.80 mark on solid Australian jobs report
The AUD/USD pair reversed early dip to 0.7970 level and spiked to fresh session tops, beyond the key 0.80 psychological mark post Australian jobs data.
China industrial production and retail sales miss estimates
China August industrial production came-in at 6.0% y/y, missing the estimate of 6.6% by a big margin. Retail sales printed at 10.1% y/y vs. expected 10.5%.
AUD/JPY fades spike above weekly 200-MA
AUD/JPY backed-off from the daily high of 88.74 and now trades around the weekly 200-MA level of 88.45 after China data missed estimates by a big margin.
USD/JPY - Three-day rally stalls at 50-DMA in Asia, eyes US CPI
The three-day rally in the USD/JPY spot has stalled in Asia, with the pair failing to take out the 50-DMA hurdle of 110.55 levels.
Key Focus ahead
The GBP/USD pair consolidated overnight UK jobs data-led sharp pullback from 1-year tops as investors now look forward to the very important BoE monetary policy decision, due to be announced later during European trading session.
GBP/USD consolidates in a range around 1.32 mark, BoE holds the key
The GBP/USD pair oscillated in a narrow trading range around the 1.32 handle and was seen consolidating overnight sharp pullback from 1-year tops.
UK's Hammond: Won't accept protectionist EU agendas after Brexit
Delivering his speech at the Mansion House in London's "Square Mile" financial district, UK finance minister Philip Hammond said, "Britain will reject "protectionist" agendas from the European Union in favour of "forward-leaning" proposals when it comes to supervising cross-border financial markets after Brexit," as reported by Reuters.
UK PM May to deliver Brexit speech in Italy on Sep 22
UK PM Theresa May will make a speech on Britain's future relationship with the EU on Sep.22 in Italy. The speech will focus on Britain's relationship with the EU after Brexit.
Apart from the BoE announcement, investors will also confront the release US CPI print, which would drive market expectations over the Fed's next policy move at next week's meeting and eventually drive the greenback ahead of next week’s FOMC meeting.
US CPI data preview - Nomura
Analysts at Nomura offered a preview for the US CPI data due in the US session tonight.
EUR/USD - Rising channel breached to the downside, focus on US CPI report
The EUR/USD dropped to a low of 1.1873 on Wednesday as tax reform talk in the US boosted the treasury yields and the US dollar. The currency pair remained on the back foot in Asia around 1.1880 levels.