Forex news for North American trading on Oct 19, 2016

  • Feds Beige Book: Job market tight. Outlook mostly positive
  • September 2016 US housing starts 1.047m vs 1.175m exp
  • Saudi Arabian bond demand stronger than expected
  • Fed's Kaplan: Inflation is likely firming
  • Kaplan: Very sensitive to the impact of what Fed does in the dollar
  • Feds Beige Book: Job market tight. Outlook mostly positive
  • ECB's Nouy: Overall capital requirements will not significantly increase under Basel III
  • EIA weekly US oil inventories -5247K vs +2100K expected
  • UK's Hammond: We see it essential to reduce net migration in a way to protect the economy
  • EU's Weber says rest of EU to be 'extremely tough' in Brexit talks; calls UK government 'arrogant'

Bank of Canada

  • Bank of Canada holds rates at 0.50% as expected
  • Poloz: BOC actively discussed more stimulus
  • BOC cuts growth forecasts: 2016 1.1% vs 1.3% prior
  • Full text of the Bank of Canada decision Oct 19, 2016
  • Poloz Q&A: We need more data to determine whether export weakness permanent
  • Full text of the opening statement of BOC Governor Poloz's press conference
  • BOC's Poloz: Data has been less than clear

Markets

  • Gold up $7 to $1269
  • US 10-year yields up 0.7 bps to 1.745%
  • WTI crude up $1.14 to $51.43
  • S&P 500 up 4.5 points to 2144
  • AUD leads, GBP lags on the day

The euro touched the lowest since July as it continues to flounder without anything really driving it lower.

The big event in North American trading was the Bank of Canada decision and Stephen Poloz decided to play some games. In the statement, he was more hawkish than expected as growth forecasts weren't cut substantially and he said the BOC was neutral. That sent USD/CAD down to 1.3000. Then in the press conference he said the BOC had 'actively considered' cutting rates and USD/CAD rallied to a session high of 1.3142.

USD/JPY neared the 100-dma, which is right at 103.00. The low on the day was six pips above but some better risk sentiment late in the day boosted it up to 103.43.

The kiwi was well-bid again as it marched up to the 55-dma at 0.7250 before settling back to 0.7225. The commodity currencies were generally stronger, in part due to the surprise draw in oil.

The Aussie took out some important technical levels and hit stops in a quick move up to 0.7729.

Cable was the laggard on the day and couldn't take advantage of a generally weak backdrop for the US dollar. Last at 1.2280.