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Foreign exchange market. American session: the euro traded lower against the U.S. dollar after the European Central Bank's press conference | 05.03.2015

 

The U.S. dollar traded higher against the most major currencies despite the weaker-than-expected U.S. economic data. Factory orders in the U.S. declined 0.2% in January, missing expectations for a 0.1% increase, after a 3.5% drop in December. That was the sixth straight decline.

 

 

December's figure was revised down from a 3.4% fall.

 

 

The decline was driven by lower orders for non-durable goods.

 

 

The number of initial jobless claims in the week ending February 281 in the U.S. climbed by 7,000 to 320,000 from 313,000 in the previous week, missing expectations for a rise by 6,000.

 

 

Final non-farm business sector labour productivity fell by 2.2% in the fourth quarter, missing expectations for a 0.4% rise, down from a preliminary estimate of a 1.8% decline.

 

 

The euro traded lower against the U.S. dollar after the European Central Bank's (ECB) press conference. The European Central Bank (ECB) President Mario Draghi said at the press conference on Thursday that the central bank will start its 60 billion euro-a-month bond purchases on March, 9. He noted that the ECB will buy euro-dominated public sector securities in the secondary market, and it will also continue to purchase asset-backed securities and covered bonds.

 

 

The ECB upgraded its growth estimate to 1.5% for 2015, up from 1% in December last year. Gross domestic product (GDP) is expected to be 1.9% in 2016 and 2.1% in 2017.

 

 

The ECB downgraded its inflation forecast for this year to 0%, down from its previous inflation forecast of 0.7%, but upgraded the 2016 forecast to 1.5% from 1.3%.

 

 

The ECB released its interest decision today. The central bank kept its interest rate unchanged at 0.05%.

 

 

German seasonal adjusted factory orders plunged 3.9% in January, missing expectations for a 0.8% decrease, after a 4.4% rise in December. December's figure was revised up from a 4.2% gain.

 

 

The British pound traded lower against the U.S. dollar. The Bank of England's (BoE) kept its interest rates unchanged at 0.5% and its asset purchase program unchanged at £375 billion. This decision was widely expected.

 

 

Analysts expect that the BoE will start to raise interest rate later in early 2016.

 

 

The U.K. Halifax house price index declined 0.3% in February, after a 1.9% gain in January. January's figure was revised up from a 0.3% rise.

 

 

The Canadian dollar traded lower against the U.S. dollar despite the better-than-expected Canadian Ivey purchasing managers' index. Canada's seasonally adjusted Ivey purchasing managers' index rose to 49.7 in February from 45.4 in January. Analysts had expected the index to increase to 46.2.

 

 

A reading above 50 indicates a rise in the pace of activity, below 50 indicates a contraction in the pace of activity.

 

 

The New Zealand dollar fell against the U.S. dollar. In the overnight trading session, the kiwi dropped against the greenback in the absence of any major economic reports from New Zealand.

 

 

The Australian dollar declined against the U.S. dollar. In the overnight trading session, the Aussie traded lower against the greenback after the mixed Australian economic data. Retail sales in Australia rose 0.4% in January, in line with expectations, after a 0.2% gain in December.

 

 

Australia's trade deficit widened to A$0.98 billion in January from A$0.50 billion in December. December's figure was revised down from a deficit of A$0.44 billion. Analysts had expected the trade deficit to rise to A$0.93 billion.

 

 

The Reserve Bank of Australia Deputy Governor Philip Lowe said on Wednesday that interest rate cut is less effective than in the past, but it weakened the exchange rate and encouraged housing construction.

 

 

The Japanese yen traded lower against the U.S. dollar. In the overnight trading session, the yen traded lower against the greenback in the absence of any major economic reports from Japan.



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