The USD traded to the stronger side of its range against both the EUR and GBP in another day of caution throughout the global marketplace. Wall Street finished the day in negative territory and its recent spate of bad results is obviously taking a toll on investor sentiment. The ADP Non Farm Employment Change report was published yesterday and turned in a disappointing gain of only 13K compared to the estimated addition of 59K. The Chicago PMI was also brought forth and offered a flat reading of 59.1. In essence there were no silver linings to be found among the gloom surrounding the economic environment. Having said this, the large degree of caution yesterday may have produced the opportunity to trade ranges among various currencies. Today the weekly Unemployment Claims, the ISM Manufacturing PMI, and Pending Home Sales will all be presented.
The three publications will serve as a good precursor towards tomorrow’s huge day, when the government Non Farm Employment Change figures are due. The weakness in the ADP report yesterday was certainly enough to keep the lingering discontent among certain investors strong. Government officials have been keen to keep a bright outlook on the economy and the U.S. Congress got into the act yesterday as they passed their new financial regulations bill. Critics however are pointing out their beliefs that many of the new rules being proposed are based on poor reasoning by the government. One thing is clear, economic data from the U.S. has been more than lackluster recently and today’s and tomorrow’s outcome will go a long way in creating further tension or easing it. The States continues to be hampered by a poor housing market and a less than promising employment situation and until these two crucial points are fixed it stands to reason that a full recovery will be tough to attain. The USD continues to foster a safe haven sentiment and if more difficulties become apparent for the U.S. and global economy, it stands to reason that the greenback will find its backers.
Written by bforex.com
