Here are the Top Forex Developments for the trading week between 12/22/14 and 12/26/14:
Number One: Canadian GDP
Forex traders received a positive surprise on Tuesday out of Canada with the release of its Gross Domestic Product or GDP which rose 0.3% in October month-over-month and 2.3% year-over-year. This beat expectations for a gain of 0.1% and 2.1% respectively, but still falls short of September’s GDP growth rate 0.4% and 2.4%.
Number Two: US Durable Goods
Durable goods orders plunged 0.7% in November and durable goods orders excluding transportation contracted by 0.4%. This compares to October’s increase of 0.3% and plunge of 1.0%. Economists expected an increase of 3.0% and 1.0% respectively. Despite the disappointment the US Dollar remained firm. Forex traders may adjust to the disappointment during the next trading week.
Number Three: US New Home Sales
The US housing market, which many thought will rebound strongly and support the US economy, continues to disappoint. New homes sales plunged 1.6% in November month-over-month. Economists were looking for an increase of 0.4%. The unexpected contraction followed October plunge of 2.2%. This spill trouble and if we get a terrible housing report for December the US Dollar could come under pressure.
Number Four: Japanese Housing Starts
The Japanese housing market continues to show a dire situation. Housing starts continue to drop in double digit figures and November was no exception. Housing starts dropped 14.3% year-over-year which was much worse than the 12.8% contraction economists expected and 2.0% bigger than the 12.3% contraction reported in October. December is likely to show another double digit contraction in housing starts.
Number Five: Japanese Labor Cash Earnings
The Japanese consumer received some troubling news this morning. Economists expected an increase of 0.4% in labor cash earnings for November year-over-year. The data released this morning showed an unexpected drop of 1.5% in November while October showed an increase of only 0.2%. This is bad news for the Japanese economy, but the Japanese Yen remained firm during today’s thin trading session.