Forex news for North American trading on March 3, 2017

  • Fed's Yellen: Rate hike at next meeting "would likely be appropriate" if data good enough
  • Yellen Q&A: Not much we can do to affect labor force growth
  • Fed's Fischer suggests there has been a concerted effort to boost hike odds and says he's ready to join it
  • February 2017 US ISM non-manufacturing PMI 57.6 vs 56.5 exp
  • February 2017 US Markit services final PMI 53.8 vs 54.0 exp
  • Baker Hughes US oil rig count 609 vs 602 prior
  • Le Pen summoned for possible charges, says she won't respond
  • Fed's Bullard sees no change in economy to justify March hike
  • SNB's Jordan: Too early to consider end of negative rates
  • Global inflation targeting has been a success says Fed's Evans
  • JPMorgan February global composite PMI 53.5 vs 53.9 prior
  • Fed's Evans: Concerned by signs inflation expectations below target
  • Fed's Lacker cites past, sees value in pre-emptive rate hikes
  • BOJ's Nakaso: Current policy framework is best to achieve goal
  • Merkel will visit Washington March 14

Markets:

  • US 10-year yields up 1 bps to 2.49%
  • WTI crude up 59-cents to $53.20
  • S&P 500 up 1 point to 2382
  • Gold flat at $1233
  • EUR leads on the day and week, NZD lags on the day and week

The US dollar finished the day near the lows despite more hawkish talk from Yellen and Fischer. Aside from saying 'we're going to hike on March 15,' they couldn't have been more explicit. Yet the dollar is down around a half-cent across the board. Why? The market is 'selling the fact'.

There was a rally in the dollar all week on Fed expectations rising and it was time to take profits on Friday afternoon. USD/JPY rose as high as 114.75 but is trading at 113.84 in the final minutes of trading this week. That's a solid retracement but it's modest given that USD/JPY tested 111.60 three days ago.

There is also talk of a squeeze on euro shorts, in part because of fresh legal troubles for Le Pen. No one, it seems is safe from the French judicial system. EUR/USD finishes the day more than 100 pips higher at 1.0620 and that's enough to push it well into positive territory on the week.

Cable caught a quick bid into the London fix and jumped to 1.2278 from 1.2250 but it faded right afterwards and was trading slightly lower on the day. But the US dollar weakness hit late and boosted the pair up close to 1.2300.

USD/CAD had its best week of the year but finished 15 pips down on Friday. The pair had been as high as 1.3437 but finishes at 1.3377 as oil turned around and the US dollar sagged.

The comments from Jordan helped to put a bid into EUR/CHF as the pair rallied to the highest in one-month and cracked 1.07.

Have a great weekend.