US production in and around expected levels - modest expansion
Looking at the manufacturing data out of the US, the headline industrial activity measure comes in a little softer than expected at 0.1% (vs 0.2% forecast), though manufacturing is 0.3% - a tenth of a percent over expectations. With the capacity utilisation rate inching up to 78.4%, we can assume this sector remains on an even keel and as such, has little impact on the USD.
We have however seen weakness developing ahead of this, with the headline EUR/USD rate pushing through the resistance at 1.1360-65, taking out stops along the way to tip the 1.1400 mark. In line with this, USD/JPY has now taken out the 113.10-112.90 support area, though as we so often see, the momentum through here is minimal as yet. Traders could be waiting to see how Wall Street performs this afternoon, so any weakness here could push the pair lower towards the 112.00 level.
The Fed's Kaplan and Clarida have been speaking also, with the former highlighting the debt levels, while Clarida remains optimistic on the outlook though does not expect inflation to run away.
All eyes now on Wall Street, with trading now getting underway. Stocks flashing red as noted earlier. It could be an eventful end to the week as if Thursday was not volatile enough with Brexit!