The faltering dollar

22 March, 2016

Sterling was suffering more than most yesterday, not impressed with weekend political developments, with the ever-present ‘Brexit’ cloud also hanging over it. Given these themes, the inflation data (released 09:30 GMT) will likely be of secondary interest, unless we see a major outlier from the expected small nudge higher in the YoY rate from 0.3% to 0.4%. The interest rate market remains more inclined towards a cut rather than hike in rates at the present moment in time, although with risk only priced around 10% towards the end of the year. We also see government borrowing figures published at the same time, which will perhaps be of greater interest given the ongoing discussions and changes being seen in the wake of last week’s budget.

After a two day turn-around, the dollar is weaker overnight even after comments from two Fed officials (Williams and Lockhart) suggesting that the next move could come as early as April. But both these are non-voting member this year, so the market took their comments with a degree of scepticism. Elsewhere, the single currency will be watching the latest PMI data early on, with provisional data for April released. In overnight trading, then yen has been the standout, weakening further against the dollar and pulling USDJPY away from the 110.67 low of late last week. With the week shortened by the Easter holiday on Friday (in some countries), trading is likely to remain on the choppy side as market liquidity falls below normal levels.


Source link  
CB meetings dominate the week

With no impactful economic data releases on the calendar today, the markets are focusing on a plethora of Central Bank meetings scheduled...

No Surprises from BoC & ADP

In an unsurprising move, the Bank of Canada decided to hold its benchmark lending rate at 1%, after two small hikes earlier in 2017. The BoC stated...

Moderate Gains for USD

On Monday, the US Commerce Department released Factory Orders data for October, indicating that the continued strength in the Manufacturing...


OPEC Extends Output Cuts

On Thursday, OPEC (Organization of Petroleum Exporters) and non-OPEC producers led by Russia agreed to keep output cuts until the end of 2018...

US Economy Expands Faster Than Predicted

Data released on Wednesday showed that the US economy expanded at its quickest pace since 2014 in Q3. The US Commerce Department said that...

Political Turmoil in Germany Hurts EUR

The EUR lost ground against many of its peers on Monday on news that Chancellor Angel Merkel’s efforts to form a coalition government had collapsed...


USD Suffers on Subpoena News

The Trump Administration is back in the spotlight with news of a report that Special counsel Robert Mueller’s investigators have issued a subpoena...

Positive data negated by tax plan opposition

The US Labor Department released data on Wednesday showing the consumer price index edged up by 0.1% in October after climbing by 0.5%...

Data Boosts EUR Can CPI Boost USD?

EUR received a boost on Tuesday, as data from Destatis showed German Preliminary GDP climbed to 0.8% in Q3, beating forecasts of 0.6%. In addition...

  


Share: