| By Christopher Vecchio, DailyFX Currency Analyst
THE TAKEAWAY: USD Existing Home Sales (JUN) > 4.37M (-5.4%) versus 4.62M (+1.5%) expected, from 4.62M (0.0%) > USD Leading Indicators (JUN) > -0.3% versus -0.1% expected, from +0.4% > USD Philadelphia Fed Index (JUL) > -12.9 versus -8.0 expected, from -16.6 > EURUSD BEARISH The news keeps getting worse for the US economy, which as of a few months ago was the world's darling economy and now has become just another blight on the global growth picture. Three 'medium' importance data releases (according to the DailyFX Economic Calendar) for the US economy were released at 10:00 EDT / 14:00 GMT, and all three disappointed. To wit: - Existing Home Sales for June fell to an annualized rate of 4.37M from 4.62M, well-below the 4.62M pace expected. Sales dropped by 5.4% month-over-month whereas a 1.5% gain was anticipated.
- Leading Indicators for June contracted by 0.3%, a faster rate than the 0.1% contraction forecasted.
- The July Philadelphia Fed Index improved, but remained stretched negative, at -12.9 versus -8.0 expected.
The data comes at a crucial time as the Federal Reserve weighs more stimuli measures to help improve growth prospects, but questions remain over what exactly will be done. As was made clear over the past two-days per Chairman Ben Bernanke's Semi-Annual Monetary Policy Report to Congress, while the Federal Reserve can do more if necessary, the necessary structural improvements to the economy will only come by way of a more prudent fiscal policy. Until the US' feckless fiscal policy is corrected, the US economy will continue to struggle, regardless of what the Federal Reserve does. USDJPY 1-minute Chart: July 19, 2012 Charts Created using Marketscope - Prepared by Christopher Vecchio Following the bevy of disappointing releases, the US Dollar initially strengthened, sending the AUDUSD lower from 1.0422 to as low as 1.0401, before rebounding to 1.0417, at the time this report was written. The EURUSD behaved similarly, dipping from 1.2244 to 1.2230. The big winner was the Japanese Yen, however, as investors shed the US Dollar as the favored safe haven play: the AUDJPY dropped from 81.97 to as low as 81.73; the EURJPY dropped from 96.27 to as low as 96.13; and the USDJPY fell to 78.52 from 78.64, before rebounding to 78.57, at the time this report was written. --- Written by Christopher Vecchio, DailyFX Currency Analyst
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