Forex today: dollar wobbles in month end flows and damp PCE
Forex today saw the US dollar on the back foot with a soft PCE reading but month end flows offered a mixed picture in general across the board in the end.
Commodities were again a benefactor of the weaker performance from the dollar which Mnuchin cheered in respect to the trade balance and NAFTA renegotiations. All in all, the dollar was closing modestly lower, -0.25% and the US benchmark 10 years were down -0.49%. After a choppy European session, the euro was able to get back above the 1.19 handle and closed 0.18% higher at 1.1904.
Sterling was up less of a fraction by 0.04% at 1.2927 and supported by the idea of rate hikes this year with BOE's Saunders suggesting that small rises now will avert the need to rush hikes later. The yen was up 0.27% and all eyes are on tomorrow's nonfarm payrolls to set the scene either bullish for 1.14 or bearish for 1.08 break out levels in USD/JPY. AUD, +0.58%, Kiwi -0.32% (still licking wounds from overnight trade and poor business confidence data) and CAD -1.05% on a come back in WTI despite Hurricane Harvey and concerns of further storms in the area along the way.
Key events ahead in Asia
- AUD: Caixin Manufacturing PMI (Aug)
Key notes from the US session
- US Treasury Sec. Mnuchin: House on track to get tax plan by end-2017 - CNBC
- Fed's Kaplan: Want to focus on recovery, safety after Harvey, rather than economic impact
- US: Pending home sales lessen 0.8% in July
- Fed: Inflation headache intensifies as core PCE hits low - ING
- US: August Chicago Business Barometer stayed unchanged at 58.9