The U.S. Dollar is trading in weaker ranges, down primarily because of a dampened mood across markets as a result of promises from the White House that tariffs will indeed stay on schedule.
Overview
Treasuries went up in price while the 10-year note yield went down to 4.33% as uncertainty over trade policy is starting to affect the outlook for the long-term. The U.S. seems to be realigning its foreign policy as well, which is hurting some decision making for investment and business normalcy. Other safe-haven assets have gained ground while items such as Bitcoin have gone down in price, now trading below $90K.
Volatility is through the roof as the VIX Index, also know as the “fear gauge” climbed to its highest level of the year thus far. Earnings will be out for big tech firm Nvidia Corp. tomorrow, which will be accompanied by a slew of data for the U.S. in the form of New Home Sales and Building Permits while the second reading of Q4 Gross Domestic Product is slated for Thursday. There will be Fed members speaking today whose statements may move the needle, Lorie Logan, Raphael Bostic, and Michael Barr.
What to Watch This Week…
- U.S. GDP on Thursday 8:30AM
- U.S PCE on Friday 8:30AM
- Monex USA Online is always open
Complete Economic Calendar can be found here.
EUR ⇑
The Euro is trending higher, and it is close to hitting its highest point in value for the year. While German elections calmed markets a bit as the EU’s largest economy avoided a victory for the far right AfD, outlooks for growth have remained optimistic especially with belief that potential peace between Ukraine and Russia can lead towards faster growth. There are doubts about the negotiations keeping European leadership at arm’s length, but certainly a deal that makes Europe feels relief from armed conflict is perceived as a boost for European markets as well as the shared currency.
MXN ⇑
The Mexican Peso’s movements have been limited but have meant some appreciation in the face of concerns that U.S. policies may hurt the American economy. While tariffs threats translated into adjustments by companies and intrigue so far, Mexico has been able to delay the possible damage and even made concessions to guarantee some flexibility with the U.S. administration. Inflation has been mostly under control, which gives Banxico plenty of room to decide how to go about interest rate cuts, which ultimately aid in easing the financial environment. With volatility all over the place, expect Peso to stay wild and unpredictable, yet steady. It is a strange time.
