North American Summary and Highlights 5 February
Overview - The USD lost some ground in Europe but stabilized in a subdued North American session.
North American session
US data showed a stronger than expected 183k increase in January’s ADP employment report, a $98.4bn December trade deficit that was even wider than expected, and a dip in January’s ISM services index to 52.8 from 54.0. The latter figure did assist a dip in USD/JPY to a low of 152.12 from 152.80 though the USD later recovered to near pre-data levels.
EUR/USD’s reaction to the data was very brief and kept to a narrow range near 1.04. USD/CAD corrected back to 1.4325 from a low of 1,4270, seeing AUD/CAD rise to .90. AUD/USD gains stalled near .63.
European morning session
The USD was generally weaker through the European morning. USD/JPY lost half a figure to 152.80, while EUR/USD gained around 20 pips to trade above 1.04. Other currencies outperformed the EUR, generally gaining around 0.3-0.4%.
The session was relatively quiet newswise. The final European PMI data saw the Eurozone composite index unrevised at 50.2 while the UK index was revised slightly lower to 50.6. Eurozone PPI was marginally weaker than expected at 0.4% m/m. French industrial production was also weaker than expected, falling 0.4% m/m in December.