Forex market performance from last week. Learn from the past to grasp the market trends of the week!
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This article is originally referred from Orbex Market Review.
- The AUD was continued to remain weak as the currency pair extended gains for the second week. The declines were sharper this time as the currency fell 2.45% on the week.
- The CAD was unable to hold on the gains and after rising 0.15% the week before, the currency fell 0.71% on the week.
- The CHF’s declines accelerated last week as the currency continued to lose ground to the USD. After shedding 2.37%, the CHF 1.13% last week turning to be the weakest currency over the week 40.
- The EUR was also weaker extending declines for two consecutive weeks. After losing 1.22% the week before, the common currency extended declines last week to close 0.84% lower. However, the slower pace of losses could signal a possible pause to the declines and could signal a potential turn around in the week ahead.
- The GBP fell 0.39% in the week before but retraced those losses last week. The currency posted gains of 0.56% for the week 40.
- The yen stalled a three week decline as price action managed to post moderate gains, as the currency closed with 0.02% gains on the week.
- A temporary pause to the rally in the NOK saw price action declining again. The NOK closed the week with losses of 1.47%.
- The NZD also remains one of the weakest currencies as it lost 2.77% on the week extending the declines from 0.80% losses the week before.
Market Highlights ‘Last Week’
WTI Crude Oil
Oil prices which have been rising at a steady pace was retreating partially last week.
A price of the international Brent oil pushed higher above $85 a barrel, reports showed that OPEC’s leading producer Saudi Arabia and Russia agreed bilaterally to increase output.
The decision was seen coming just before the OPEC members met for a summit in Algiers.
The move comes as the U.S. President Trump was seen putting pressure on Saudi Arabia to lower prices.
This comes as the U.S. sanctions on Iran take effect from November. Iran’s curbs on oil exports are expected to plug a gap to supply.
UK Monthly PMI
The monthly PMI report from the UK showed that manufacturing, construction and services activity painted a mixed picture.
However, the overall data for the third quarter indicated that the UK’s economy might have maintained a 0.4% quarterly pace of GDP growth.
Manufacturing activity rose slightly to 53.8 beating estimates of 52.6 and advancing from the month before.
Construction activity eased from 52.9 in August to 52.1 in September while services sector jumped to 54.9 from 54.3 in August. Despite the mostly positive outlook, the GBP barely reacted.
With the Brexit deadline fast approaching, investors are keen on whether the UK will be able to exit the EU with a trade deal in hand.
Australia Monetary Policy Meeting
The RBA held its monetary policy meeting last week. As widely expected, central bank left the benchmark interest rates unchanged at 1.50%.
The RBA said that after assessing the economy it justified having to keep a stable monetary policy. Inflation in Australia is yet to reach the RBA’s mid-point of 2.0%.
The central bank was however optimistic that with the recent uptick in the labor market data wage growth would eventually help to push inflation higher.
The central bank also noted that the exchange rate level for the trade weighted index for the AUD was in line with expectations.
U.S. ISM non-manufacturing PMI
U.S. ISM non-manufacturing PMI surges.
Data from the Institute of Supply Management showed that activity in the non-manufacturing sector surged to the highest level since record keeping began.
Non-manufacturing PMI rose to 61.6, beating estimates of 58.0.
However, manufacturing PMI was seen easing to 59.8 in September after the index hit a 14-year high in September.
The data showed that the U.S economy continued to maintain the momentum.
The official payrolls report for September was released on Friday.
Data showed that the U.S. economy added far fewer jobs than anticipated. But the unemployment rate fell to new historic lows of 3.7%.
This came as the participation rate held steady.
The decline in the number of jobs was attributed to the Hurricane Florence which wrecked havoc.
The average hourly earnings were seen rising 2.8% on the year and it held steady.
Previous revisions for July and August managed to offset the weak headline print in the jobs.
Original Source: Orbex Market Review