North American Summary and Highlights 7 Oct

North American session

USD/JPY broke through 151 and accelerated in the afternoon getting close to 152. EUR/USD traded a relatively narrow range for most of the session, but eventually nudged below 1.1650. GBP/USD was a little more volatile, reversing an early dip below 1.34 as was a brief rise in EUR/GBP above .87. AUD/USD saw only marginal losses to .6580, while USD/CAD kept close to 1.3950. Canada reported a wider than expected August trade deficit of C$6.32bn but a stronger than expected September Ivey manufacturing PMI of 59.8. 

Equities and UST yields were lower as the government shutdown continues. The New York Fed reported slightly higher consumer inflation expectations in September. Fed’s Kashkari cautioned against excessive easing though Miran reiterated his dovish views, while Daly was positive on the impact of AI.  

European morning session 

The USD gained around 20 pips against both the EUR and JPY through the European morning. The session was generally quiet, with only German factory orders in the way of significant data. These were weaker than expected, falling 0.8% on the month to record their fourth straight decline, and likely contributed to the EUR’s decline. The EUR was generally softer on the crosses, although there was little change in EUR/CHF or EUR/NOK. 

The French trade deficit was slightly larger than expected at EUR5.5bn in August, but there was no further news on the French government after yesterday’s PM resignation.