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Forex Market Majors Struggle Despite Upbeat US Data

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Forex Market Majors Struggle Despite Upbeat US Data
  • US Jobless Rate Beats Expectations Again
  • Existing Home Sales Also Surge
  • Euro and Pound Both Struggle as Traders Hold Off

Thursday saw the release of positive data on multiple fronts in the US. This has done little though to dissuade traders from holding on to their safe haven US Dollar for the moment. The weekly jobless claim rates dropped again, beating expectations but remaining high. Existing home sales figures also showed a significant jump for September. None of this was enough to boost the forex market for those trading the Euro or GBP. Both have continued to struggle today as traders await more US election answers.

Lowest Jobless Claims Since Pandemic Began

Although they are falling slowly, they are indeed falling. The weekly US jobless claims rate for initial claims again bettered expectations with a fall to 787,000 for last week. This brings the number to its lowest point since March 14th, and well ahead of the 875,000 that had been forecast. Continuing claims also dropped by more than 1 million.

While this data would typically point to a move away from the Dollar, this has not been the case today. That is likely due to the fact that most forex trading in the market are waiting poised for any update on the US stimulus negotiations before making a move. While the two sides appear to be edging closer by the day, nothing is yet signed and sealed.

Home Sales Skyrocket for September

While other areas of the market appear turbulent, one sector is going only in an upward direction. That is home sales. Data released today show that existing home sales in September jumped a huge 9.4%. These figures go alongside other impressive data to show that the COVID-19 period has seen a surprising boom in the housing sector. This has pushed home prices continually higher as a result.

The pricing spike is largely due to the combination of increased demand for homes coupled with a huge drop off in supply. There were below 1.5 million homes for sale nationally which is the lowest number in almost 40 years. Another factor here has been the currently low-interest rates which provide more buying power.

Other Majors Fail to Lift Off

Despite all of the positive data from the US, forex brokers have yet to see an uptick in demand for either the Euro or Sterling. Both remain under pressure largely due to a holding pattern from traders who want to see if a stimulus package can be agreed in the US. The upcoming final US Presidential debate may also be playing a factor.

The British Pound has also slipped today as rumors persist that the Bank of England is taking a closer look at implementing negative interest rates. This comes as more areas of the country have been placed under the strictest coronavirus lockdown levels by leader Boris Johnson. The EU chief negotiator is also said to be in the UK today looking to salvage an unlikely post-Brexit trade agreement.

 

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Anthony is a financial journalist and business advisor with several years’ experience writing for some of the most well-known sites in the Forex world. A keen trader turned industry writer, he is currently based in Shanghai with a finger on the pulse of Asia’s biggest markets.

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