As data releases finally picked up steam for the week yesterday and today, the United States Dollar is losing ground across the board against the G10 this morning.
Overview
After having its best quarterly performance in one year, the Buck has established itself as a safe-haven asset in the midst of worries about a dented economy and lower growth to come from the U.S. as well as worldwide. China, the world’s largest second economic engine, will not be propelling any headlines or activity as it observes a week-long holiday in its Golden Week.
Meanwhile, U.S. Treasury bond yields are at the highest since 2007 ahead of a speech by Fed Chair Jerome Powell later today. Furthermore, equities are looking down for the moment as Wall Street digests the last-minute deal by Congress to fund the government and avoid a shutdown. Investors will look for Powell to show less hawkishness in order to feel good about the Fed being somewhat more accommodative now than it has been. There is a plethora of data to chew on until the weekend, with the Employment Situation on Friday.
What to Watch Today…
- No major economic events are scheduled for today
- Monex USA Online is always open
EUR ⇓
The Euro has fallen 2.5% since the start of September, tumbling after growing doubts over the ability to sustain growth in the Eurozone. Although last month showed better Economic Confidence than expected, and inflation in the form of the Consumer Price Index showed a deceleration, the Euro was plagued by negativity and other data being evidence of a stagnant time.
Nevertheless, European Central Bank Vice President Luis de Guindos gave remarks over the weekend in an interview highlighting the progress made in reducing some costs while explaining that officials are still in a “tightening” mindset and will not be considering interest rate cuts any time soon. ECB Chief Economist Philip Lane will speak tomorrow, while statements are expected from ECB President Christine Lagarde on Wednesday. Not much in terms of data except today’s Unemployment Rate for the Euro-Zone, which came in as estimated at 6.4%.
GBP ⇓
Sterling is also on the decline today as the focus is on the strength of the American economy that can sustain another interest-rate hike. In the UK, housing reports demonstrate that despite the higher borrowing costs, the Housing sector has not fallen apart. There is data ahead this week that could compound on that assessment and improve the value of “cable.” We have the Purchasing Managers Index on Wednesday.
