North American Summary and Highlights 3 August

North American session

The USD saw some gains in North America, assisted by a stronger than expected July ISM manufacturing index of 55.5 from 53.3. At the same time June construction spending fell 0.1% after a flat May, but a downward revision to April may weigh on Q2 GDP revisions. Later the Q3 Fed SLOOS survey showed stronger demand for Q+I loans.

USD/JPY moved up to near 157 from 156.50 while EUR/USD fell to near 1.1510 from 1.1530. EUR/GBP was slightly firmer near .857. USD gains versus AUD and CAD were marginal, though AUD/USD edged below .70 and USD/CAD touched 1.4050.

European session

European morning largely digesting recent news and action, with a minor amount of consolidation after recent intraday oversold dollar action, but with the wider backdrop still being one of the market caught long dollars.  

Japan money market data suggests Japan may have spent in order of $36 1/2bn on Friday’s intervention. Focus more of course on the implications of the confirmed joint nature of the last round and the drivers and implications of that.

Brent remains down around $4, slightly trimming the gap down, waiting to see how the regional brokered talks from today progress. NOK still the most responsive sessions to session. US10s -5/6bp, S&P future + ½ %. EZ Jul final manufacturing PMI 51.9 from 52 prelim. Swiss Jul CPI 0.4% from 0.5%y/y, in line with market.