Tag Archive: US

EMU Q4 23 GDP Stagnates, Underscoring Divergence with the US

2024-01-30

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2024-01-30

Overview: The US dollar is mixed ahead of the start of the FOMC meeting and is mostly in its recent ranges. The euro, which was sold below $1.08 yesterday for the first time since mid-December is holding above it today. The less-than-expected projection of US Treasury borrowing requirements for Q1 and Q2 weighed on US rates, which, in turn, dragged the greenback lower against the yen. It is trading near a four-day low, a little above JPY147.00. The...

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Oil Retraces Initial Surge, Euro Slips to Marginal New Low, while Sterling Hugs $1.27

2024-01-29

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2024-01-29

Overview: Key developments today include the Hong Kong court ordered liquidation of China's Evergrande and the reversal of oil prices after a sharp rally initially in Asia after separate attack in the Middle East that killed US troops in Jordan and struck a Russian oil tank in the Red Sea. March WTI, which settled near $78 ahead of the weekend, its best level since the end of last November, rallied to about $79.30 before returning to almost $77.50...

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Attention turns to Lagarde’s Press Conference and US Q4 GDP

2024-01-25

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2024-01-25

Overview: The US dollar is trading mostly quietly in narrow ranges against the G10 currencies ahead of the ECB's President Lagarde's press conference at the conclusion of the policy meeting and the first estimate of Q4 US GDP. With elevated price pressures, Norway's central bank left rates steady and reiterated its signal that rates will remain high for some time, and this has lifted the krone by about 0.5% to leader the major currencies. Most of...

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PBOC Cuts Reserve Requirements, but USD Pullback may offer New Buying Opportunity in North America

2024-01-24

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2024-01-24

Overview: After a strong showing yesterday, the dollar was sold in Asia and Europe. China announced a cut in reserve requirements and took more informal action to support the stock market, which encouraged risk-taking. Yet, the dollar's decline has stretched intraday momentum indicators, which may provide early operators in North America a new dollar buying opportunity. The ECB and Norway's central banks meet tomorrow, and the US reports its first...

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BOJ Stands Pat, Exit Draws Closer, while HK Liquidity is Squeezed Easing Pressure on the Yuan

2024-01-23

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2024-01-23

Overview:  The dollar remains largely confined to its recent ranges as the consolidative phase extends. The Bank of Japan stood pat and revised its forecasts as it is seen drawing closer another adjustment in policy, with the market still favoring an April timeframe. A squeeze in the Hong Kong money market and talk of a large package to support the equity market helped lift the Chinese yuan for the third consecutive session and lifted Chinese...

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China Equity Slump Continues, while Dollar Extends Consolidation

2024-01-22

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2024-01-22

Overview: The foreign exchange market is quiet to start the new week. As the North American session is about to begin, the dollar is mostly +/- 0.10% against most of the G10 currencies. The Swedish krona is the notable exception, rising about 0.25% against the US dollar amid good demand for its bonds today. Emerging market currencies are mostly lower. The Taiwanese dollar is the strongest in the complex so far today, rising about 0.30% against the...

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Quiet End to a Busy Week

2024-01-19

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2024-01-19

Overview: The dollar's surge in the first part of the week has given way to consolidation. The US dollar is sporting a softer profile against most of the G10 currencies. The Dollar Index is threatening to snap a three advance. Sterling is a notable exception following the weakest retail sales report since 2021. Most emerging market currencies, including China, Taiwan, and Mexico are slightly firmer. US President Biden is expected to sign a bill...

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Dollar Rally Pauses, but Fuel from Interest Rate Adjustment may not be Complete

2024-01-18

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2024-01-18

Overview: This week's dollar surge is consolidating today. Interest rates have steadied, but the adjustment, which involves pushing the first rate from March toward June does not appear complete. This suggests the dollar's recovery from last November-December's sell-off may not be complete either. Today, though, it is a little firmer against all the G10 currencies but the Swiss franc. Most emerging market currencies are also trading with a slightly...

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Stronger-than-Expected UK CPI Helps Steady Sterling after Dollar Rally Extended

2024-01-17

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2024-01-17

Overview: The sharp dollar advance is stabilizing after follow-through gains earlier today. A larger than expected rise in the UK's December CPI helped sterling recover from the push below $1.26, the lower end of a one-month trading range. It is the only G10 currency that is firmer against the dollar ahead of the North American session. ECB's Lagarde pushed back against the early rate cut speculation and this may have stemmed the euro's losses. The...

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Greenback Surges as Rates Back Up

2024-01-16

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2024-01-16

Overview: The US dollar is bid across the board and posting its best session of the month. It is up between about 0.5% (Canadian dollar) to almost 1.0% (Australian dollar) among the G10 currencies. Among the emerging market currencies, only the Russian ruble is holding its own.

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China Data Dump Keeps Market Looking for a Rate Cut Next Week

2024-01-12

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2024-01-12

Overview:  The mostly consolidative week for the US dollar continues. Most for the G10 currencies are +/- about 0.25% today and only a slightly wider range for the week. The odds of a Fed rate cut in March is virtually unchanged on the week at around 75%. The JP Morgan Emerging Market Currency Index is practically flat on the day and week. The Russian ruble and Mexican peso lead today's advancers, while eastern and central European currencies are...

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Can the US CPI Break the Dollar out of its Consolidation?

2024-01-11

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2024-01-11

Overview: Stocks and bonds are trading higher, and the dollar is narrowly mixed ahead of the December US CPI report. Most of the large bourses in Asia Pacific advanced, led by Japan to new 30-year-plus highs. Hong Kong's Hang Seng snapped seven-day slide to post its first gain of 2024. Europe's Stoxx 600 is up about 0.33%, to recoup most of its losses in the past two sessions. US index futures enjoy a modest upside bias. Benchmark 10-year yields in...

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The Dollar Goes Nowhere Quickly

2024-01-09

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2024-01-09

Overview: The dollar continues to consolidate broadly after the dramatic price swings at the end of last week. For the most part, the greenback remains inside yesterday's ranges, which were inside last Friday's. The G10 currencies are a little heavier today, except the Japanese yen and Norwegian krone, which are posting small gains. Indeed, the greenback is near session highs against most of the major currencies as we go to print. Emerging market...

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Greenback is Bid ahead of the Jobs Report

2024-01-05

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2024-01-05

Overview: The dollar is bid going into the December jobs report. After selling off into the end of last year, it has recovered this week. The five-day moving average is crossing the 20-day moving average against several of the currency pairs, capturing the shift in momentum. The greenback's gains have as interest rates have jumped. The 10-year Treasury yield finished last year near 3.88% and is now near 4.04%. European benchmark rates have mostly...

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Consolidative Tone Emerges Ahead of Tomorrow’s US Jobs and EMU CPI

2024-01-04

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2024-01-04

Overview: After gaining for the past couple of sessions to open the New Year, the dollar is mostly softer today. The yen is the main exception. The greenback was bid above the JPY144 area where chunky options expire today. Most emerging market currencies are also firmer though there are a few exceptions in Asia, like the South Korean won and Thai baht. Still, the general tone is consolidative ahead of tomorrow US jobs data and the eurozone's CPI....

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Holiday Moves Continue to be Unwound

2024-01-03

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2024-01-03

Overview: The dollar is firm. Rates are mostly higher and equities lower. The moves scored in the holiday-thin markets are at end of last year are being unwound. This does not appear complete yet. Geopolitical tensions remain high but do not seem to be having a direct market influence as both gold and oil are trading lower. Among the G10 currencies, sterling has been the most resilient today but nearly flat. Within the emerging market complex, the...

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Firm Start for the Greenback

2024-01-02

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2024-01-02

Overview: The US dollar begins the new year on a firm note. It is recovering against nearly all the G10 and emerging market currencies today after depreciating in the holiday-thin markets over the past couple of weeks. Japanese markets are on holiday until Thursday. The yen and Swiss franc are the poorest performers among the G10 currencies. Among emerging market currencies, the Mexican peso, Hungarian forint, and South African rand are bucking the...

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Soft US CPI Today Paves Way for Fed Pivot Tomorrow

2023-12-12

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2023-12-12

Overview: The US dollar is trading softer against all the G10 currencies ahead of what is expected to be a soft November CPI report, which paves the way for a pivot by the FOMC tomorrow. It is expected to signal that policy may be sufficiently restrictive and anticipate being able to cut rates next year more than it thought in September, even if not as much as is priced into the market. Among emerging market currencies, central European currencies...

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BOJ Speculation Unwound, Taking the Yen Lower

2023-12-11

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2023-12-11

Overview: The busy week of central bank meetings is off to a mostly slow start. The dollar is narrowly mixed in quiet turnover, except against the Japanese yen. Many participants seemed to exaggerate the risks of a BOJ move next week and dollar continued its recovery that began ahead of the weekend. Among emerging market currencies, central European currencies appear to be aided by the firmer euro. They are resisting the dollar's advance seen...

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The Yen Stabilizes in a Broad Range but the Focus is on Today’s US Employment Report

2023-12-08

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2023-12-08

Overview: The US dollar is a little firmer ahead of the November employment data. It is trading mostly inside yesterday's range. It is in a wide range against the Japanese yen (~JPY142.50-JPY144.50) even if not as wide as yesterday (~JPY141.70-JPY147.30). The Canadian and Australian dollars are the strongest among the G10 currencies, while the South Korean won, and Taiwanese dollar are the best performers among the emerging market complex. Gold,...

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