The US dollar rose against all the major currency pairs, but was mixed for the week with the USD falling vs the CAD and the NZD.
Fundamentally, the US data today was mixed with the S&P global PMI manufacturing and services indices higher.
From Chris Williamson, Chief Business Economist at S&P Global Market Intelligence
The business mood has brightened in November, with confidence about the year ahead hitting a two-and-a-half year high. The prospect of lower interest rates and a more probusiness approach from the incoming administration has fueled greater optimism, in turn helping drive output and order book inflows higher in November. The rise in the headline flash PMI indicates that economic growth is accelerating in the fourth quarter, while at the same time inflationary pressures are cooling. The survey’s price gauge covering goods and services signalled only a marginal increase in prices in November, pointing to consumer inflation running well below the Fed’s 2% target.
A concern is that growth remains heavily reliant on the services economy, with manufacturing production declining at an increased rate. However, the promise of greater protectionism and tariffs has helped lift confidence in the US good producing sector, which is already feeding through to higher factory employment. Factories are meanwhile stepping up their purchases of imported inputs as they seek to front-run tariffs, putting pressure on supply chains to a degree not seen for over two years. Any further stretching of these supply lines could see prices move higher as demand outstrips supply.
Later the University of Michigan sentiment came in weaker than expectations with the index moving to 71.8 from 73.0 preliminary, but was up from 70.5 last month. Inflation readings were mixed with the one-year inflation expectations remaining study a 2.6% versus the preliminary lower than the 2.7% last month. However the five-year inflation expectations rose to 3.2% from 3.0% last month.
Canada retail sales data for September came in and is expected 0.4% for the headline number but was expected 0.9% orders. The estimate for October came in fairly solid 0.7%.
Yields were mixed today with the shorter end higher and the longer end lower flattening the yield curve
Bitcoin reached another record level with the price reaching a $99,800 just to hundred dollars short of Bitcoin $100K. The digital currency that never sleeps will be eying the $100K level over the weekend. For the week, the price is up $9290.
Thank you for the support this week. Adam is back on Monday from the Finance Magnate conference in London.
This article was written by Greg Michalowski at www.forexlive.com.