Thursday, 19 Aug 2010

USD Tumbles Following Poor US Economic Data

Following several disappointing US economic events published this afternoon, the US dollar tumbled against its main currency rivals throughout evening trading. The US unemployment figure came in well above expectations, while the Philly Fed Manufacturing Index came in at its lowest level since July 2009. Both of the indicators reflected the fragility of the US economic recovery, and just how far the country needs to go to get back on solid ground.

USD/JPY dropped below the 85.00 range earlier today, near a 15-year low. The pair has since staged a minor correction and is currently trading around the 85.30 level. EUR/USD dropped some 100 pips before experiencing a minor upward correction. The pair is currently trading right around the 1.2825 level.

Tomorrow, traders will want to pay attention to the Canadian Core CPI figure, set to be released at 11:00 GMT. As the only significant news event scheduled to be released, it has the potential to create heavy volatility among CAD pairs. Should the report come in at its predicted 0.1%, the loonie is likely to make gains in afternoon trading.