Dollar Index surged to 96.60 during the US session as Euro Dollar tumbled to an 11-year low. Other majors also fell against the Dollar. US economic data performed slightly weaker than forecasted probably affected by the severe cold strong in the Northeast. The weekly unemployment claims rose to 320K. This marks the first time in nine months that the claim was higher than 300K. Also, factory orders fell by 0.2% versus an expected 0.2% expansion. It is the sixth consecutive contract of this data, showing how manufacturing activities are slowing.
The Euro Dollar once fell below the 1.10 level – the lowest since September 2003. ECB held their benchmark interest rates unchanged in line with market expectation. President Draghi said in the press later, the bond purchase will start from 9th March and will continue if the inflation rate is still not satisfactory. The Euro once touched day highs of 1.11 during Draghi’s speech but quickly reversed all gains and refreshed the day low. The 1.10 integer level may provide some support in the short term and next support below may be September 2003’s low of 1.0760.
Australian Dollar broke the range between 0.78-0.7850 and fell to 0.7780 this morning, following the Euro’s falling. Beijing set its 2015 growth rate to 7% showing the Chinese leaders are accepting the ‘new normality’ of economic development. The short-run movement of AUDUSD may still be limited to the sideway range of 0.7750-0.79. A downward break will lead a fall to double bottom level 0.7650.
Back to stock markets, Shanghai Composite slumped by almost 1% to 3248 as the government set new growth target to 7%. The Nikkei Stock Average gained 0.26%. Australian ASX 200 closed as unchanged. European markets were supported by the beginning of QE, the UK FTSE was up 0.61%, the German DAX gained 1% and the French CAC Index rose 0.94%. The US stock indices’ rose slightly. The S&P 500 closed 0.12% higher at 2101. The Dow rose 0.21% to 18135, and the Nasdaq Composite Index gained 0.32% to 4983.
On the data front, Eurozone revised GDP will be released at 21:00 AEDST. US NFP report and unemployment rate will be out at 0:30 after midnight.
Have a great trading day!
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