Posted on: 29 March 2016, by: Pepperstone Support, category: Market Review
Soft US data was the key influencer of the day, prompting a broad based USD sell-off and several Q1 GDP downgrades across the Street.
The total PCE deflator dipped by 0.1%MoM (-0.1065%) in February, lowering the YoY rate from 1.2% to 1.0% (0.964%). Core PCE deflator rose by 0.1%MoM (0.149%) in February, and held at 1.7%YoY (1.677%).
Nominal personal spending rose by 0.1%MoM in February, as expected.
Atlanta GDPNow model downgraded its Q1 GDP estimate from 1.4% to 0.6% following data.
The US deficit widened to USD62.864bn versus USD62bn expected.
Pending home sales, which surged by 3.5% versus 1.2% forecasted, was the best bit of a bad bunch.
Overall, we see light USD selling against G-10 in the wake of the dovish Fed and recent bit of weak domestic data. There is massive risk this week for the overall USD trend with plenty of Fedspeak, NFP on Friday, and the ending of fiscal year end in Japan which usually kicks off a bit of cross JPY volatility.