Forex news for North American trade on July 29, 2021:
- US Q2 advance GDP +6.5% vs +8.5% expected
- US initial jobless claims 400K vs 382K estimate
- Germany July preliminary CPI +3.8% vs +3.3% y/y expected
- US auctions of $62 billion of seven year notes at a high yield of 1.05%
- BOJ's Noguchi: BOJ may be able to begin debate on strategy for hitting price target around end of 2021
- US June pending home sales -1.9% m/m vs +0.3% expected
Markets:
- Gold up $21 to $1823
- US 10-year yields flat at 1.265%
- WTI crude oil up $1.20 to $73.59
- NZD leads, USD lags
The post-FOMC dollar slump continued on Thursday. Soft economic data wasn't the main reason but it contributed with the dollar easing further after the numbers.
There is no easy answer for what's behind the dollar selling but with the Fed in no rush to hike and delta taking a bite out of the US recovery, the market is looking elsewhere. To be sure, some of the story is also better sentiment as US equities touched a record high once again Thursday.
The main winners in the latest leg of dollar weakness have been the euro and sterling. Both continued their runs on Thursday with a steady 30 pip climb in NY trade. The larger move on the day was the kiwi, which climbed nearly a full percentage point but most of that was in Asia.
The Canadian dollar got some help from a two-week high in oil and a bounce in natural gas on tighter inventories. The pair has steadily fallen to 1.2445 from 1.2575 before the FOMC.
