North American Summary and Highlights 18 March
Overview - The USD was mostly softer but edged higher against the commodity currencies as equities struggled.
North American session
US data was on the strong side of expectations with a 11.2% rise in housing starts and a 0.7% increase in industrial production. The USD saw some early strength with EUR/USD slipping briefly below 1.09 and USD/JPY getting close to 150, but with equities and UST yields subsequently slipping USD/JPY slipped back to 149.10. EUR/USD returned to 1.0950 near European highs while GBP/USD managed a fresh high above 1.30. German fiscal reform was passed and Russia agreed to a 30-day truce on Ukrainian energy infrastructure, but not a full ceasefire.
Equity weakness weighed on the commodity currencies, though AUD/USD was only marginally weaker after seeing a brief dip below .6350. A rise in Canadian CPI to 2.6% from 1.9% helped USD/CAD see a low of 1.4270 but a rebound above 1.43 followed.
European morning session
The USD was mostly weaker through the European morning. EUR/USD gained 20 pips to 1.0930, although it reached a high of 1.0955 mid-session, its highest since October, and USD/JPY lost 20 pips to 149.60. GBP/USD was also slightly firmer although EUR/GBP edged higher, but commodity currencies were little changed against the USD. Scandis were the best performers, gaining slightly against the EUR, while EUR/CHF was unchanged.
The German ZEW survey showed a slightly improvement in the expectations index but a decline in the current conditions index. The annual intervention report from the SNB showed they bought foreign currency worth 1.2 billion Swiss francs ($1.36 billion) in 2024.The figure compared with 132.9 billion Swiss francs of foreign currencies sold by the SNB during 2023.