Rational FX: ILO unemployment rate shows little movement [20/01/2011]

• The 3 month ILO unemployment rate from November was released yesterday morning this figure came in as expected and showed little movement on the market.
• In the Euro zone yesterday the construction output figures came out worse than expected on the month and on the year.
• In the US yesterday the main focus was on the housing market with the MBA mortgage applications and the Housing starts MoM. The figure came out worse than expected and we still witnessed a weaker US Dollar on the day compared with all major currencies. This has indicated that the US housing market is still facing problems as not as many mortgages are being accepted in conjunction not as many houses are being built. Suggestions have been made that these figures may take a few months to improve as this was the worst figure for one year.

Today’s market movers

• There are no figures released from the UK today.
• In Euro-zone we have consumer confidence this is expected to come in slightly lower than previous, this is an inflationary figure a low figure shows less expansion in the economy. If confidence in spending is low inflation may stay the same and indicates that interest rates may not change.
• In the US we have existing home sales the figure which, is expected higher. This figure measures the housing market conditions. If better than previous it will show that more people are buying homes and shows the economy is recovering. If this comes in as expected it may weaken the US Dollar somewhat as we see more risk appetite.