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Market Review – 16/10/2021 15:35GMT
Dollar ends lower on return of risk appetite
The greenback ended the day lower against majority of its peers except the safe-haven jpy as a rebound in U.S. stocks together with a surprise increase in U.S. retail sales triggered the return of risk sentiment.
Reuters reported U.S. retail sales unexpectedly increased in September, but there are fears that supply constraints could disrupt the holiday shopping season amid continued shortages of motor vehicles and other goods. Retail sales rose 0.7% last month, the Commerce Department said on Friday. Data for August was revised higher to show retail sales increasing 0.9% instead of 0.7% as previously reported. Sales last month were partly lifted by higher prices. Economists polled by Reuters had forecast retail sales slipping 0.2%.
Versus the Japanese yen, dollar traded with a firm undertone in Asia and gained above Wednesday’s 113.80 high to 114.16 ahead of European open. The pair then ratcheted higher to a fresh 3-year peak at 114.46 in New York morning on release of upbeat U.S. retail sales together with active cross-selling in jpy before retreating to 114.00 on profit-taking.
The single currency found renewed buying at 1.1589 in Asia and rose to session highs at 1.1619 in European morning in risk-on trade. However, price pared its gains and retreated to 1.1590 at New York open due partly usd’s strength together with cross-selling of euro especially vs sterling and later swung sideways, price last traded at 1.1601 near the close.
The British pound also found renewed buying at 1.3668 at Asian open and gained to 1.3689 in Asia. Cable then jumped in European trading on active cross-buying of sterling especially vs euro and rose to near 1-month peak at 1.3773 in New York morning before retreating on profit-taking.
Data to be released this week :
New Zealand CPI, U.K. Rightmove house price, China industrial output, retail sales, GDP, Canada housing starts, U.S. industrial production, capacity utilization, manufacturing output and NAHB housing market index on Monday.
Swiss trade balance, exports, imports, EU construction output, U.S. building permits, housing starts, redbook and New Zealand GDT price index on Tuesday.
Japan exports, imports, trade balance, Australia Westpac leading index, China house prices, U.K. CPI, RPI, PPI input prices, PPI output prices, FCLG house price index, Germany producer prices, EU current account, HICP, U.S. MBA mortgage application and Canada CPI on Wednesday.
U.K. PSNB, PSNCR, CBI trend orders, France business climate, Italy industrial sales, U.S. initial jobless claims, continuing jobless claims, existing home sales, leading index change, Canada ADP employment change, new housing price index and EU consumer confidence on Thursday.
Australia manufacturing PMI, services PMI, U.K. Gfk consumer confidence, retail sales, Markit manufacturing PMI, Markit services PMI, Japan nationwide CPI, Jibun bank manufacturing PMI, France Markit manufacturing PMI, Markit services PMI, Germany Markit manufacturing PMI, Markit services PMI, EU Markit manufacturing PMI, Markit services PMI, Italy producer prices, Canada retail sales, U.S. Markit manufacturing PMI and Markit services PMI on Friday.