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US dollar stabilizes ahead of active data wire

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US dollar stabilizes ahead of active data wire

The United States dollar stabilized after losing three quarters of a percent over the past three sessions. The greenback was under pressure after Congress struck an accord to lift the budget impasse and end the 16-day government furlough. The economic impact of the shutdown likely means the Federal Reserve won’t scale back the pace of monthly asset purchases this year.

The US dollar is treading water at 79.67 against a basket of its major peers, as market participants look ahead to the most active data wire since the budget impasse seized government activity October 1. The sale of previously-owned homes fell almost 2 percent in September after approaching a four-year high the previous month, according to the National Association of Realtors. Over the next several days US dollar pairs will react to a heavy influx of economic data, as market participants attempt to weigh US recovery against Federal Reserve policy.

Jobs data will make headlines Tuesday when the Labor Department releases its delayed September nonfarm payrolls report. The US economy is expected to have added 180,000 jobs in September, although this won’t be enough to shift the unemployment rate, which is expected to hold steady at 7.3 percent. All forecasts are based on a median estimate of economists surveyed by Bloomberg News.

On Friday the Census Bureau will release a delayed report on September durable goods orders, which are expected to have risen 1.1 percent after a modest 0.1 percent hike the previous month. In the middle of the week market participants can expect monthly manufacturing PMI for the United States, which could significantly shape the fortunes of US dollar pairs.

Several peers will also release key economic data this week, led by a quarterly GDP report from the UK. Japan will release consumer inflation data, a critical marker of the Bank of Japan’s record stimulus program. The Bank of Canada will hold a press conference to discuss its latest rate decision, and privately held Markit Group will report on the euro area’s manufacturing and service economies. FOREX traders are advised to keep a pulse of the economic calendar for latest developments.

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