21 March, 2017
The dollar remained soft in Asian trading today as it came under pressure from falling US Treasury yields following not-so-hawkish speeches by Fed officials on Monday. Chicago Fed President Charles Evans quashed hopes for a faster pace of rate hikes. He reiterated the Fed’s message from last week’s FOMC meeting that the pace of interest rate increases will be gradual and the projections were for a total of three hikes this year. Meanwhile, Minneapolis Fed President Neel Kashkari, who was speaking on CNBC TV yesterday, said that there was no urgency to raise rates and that he would like to see more inflation in the US economy. Kashkari voted against a rate hike in the latest FOMC meeting on March 15 when the Fed raised rates by 25 basis points.
The dollar may come under volatility as more Fed speakers are due to speak later today. This includes New York Fed President William Dudley, Boston Fed President Eric Rosengren, Kansas City Fed President Esther George and Cleveland Fed President Loretta Mester.
Disappointing Fed-speak brought down the US 10-year Treasury yield to a 2-week low of 2.46%, helping weaken the dollar against the yen in early Asian session trading, reaching a 3-week low of 112.25, before recovering to 112.85.
The televised French presidential candidate debate on Monday helped fuel the euro higher after it was evident that centrist Emmanuel Macron had a lead over far-right leader Marine Le Pen. The euro rose to a 6-week high of 1.0797.
Sterling consolidated after Monday’s drop below the key $1.2400 level. The pound fell from a 3-week high of $1.2435 on news that UK Prime Minister Theresa May will trigger Article 50 to start official Brexit talks on March 29. UK inflation data for February will come into focus today.
In other news, the Reserve Bank of Australia published the minutes of its latest policy meeting today and signaled its concern over the nation’s overheated housing market. As a result, the aussie fell against the greenback after the minutes, to reach as low as $0.7698.
In commodities, gold fell on profit-taking after reaching a 2-week high on Monday. The precious metal slipped by around half a percent to reach $1,226.76 an ounce.
Brent crude oil bounced higher towards $52 a barrel while WTI oil reached $49.30 a barrel.
The main economic releases to watch out for today include UK CPI data and Canadian retail sales numbers. The main events include a speech by Bank of England Governor Mark Carney and speeches by Fed officials.
The European Commission will publish its economic sentiment indicator (ESI) on Thursday at 09:00 GMT, which comes hot on the heels of last week...
Data on durable goods orders will be watched out of the United States this week for an indication of business spending amid a worsening trade row between...
The Fed last raised rates in March, taking the federal funds rate to a target range of 1.50-1.75%. At the time, the Fed maintained its projection of a total...
The dollar stabilized today after sliding to a four-month low against the yen in reaction to news of the setback on healthcare reform...
EURUSD is currently up for the day and roughly at the level of the six-week high of 1.0782 recorded on Thursday. The RSI indicator is pointing to a bullish short-term bias as it is well above the 50 neutral level at 61...
The euro was one of the top performing major currencies in the Asian session today after being lifted...
The Asian session was an interesting one for both AUD and the NZD...
The US dollar traded in a narrow rage against the yen as investors await the outcome of the Federal Reserve’s two-day policy meeting later today. It is widely expected that the FOMC will announce a rate hike...
EURGBP is being capped by the daily Ichimoku cloud which is acting as very strong resistance. The last time...