The U.S. Dollar is trading in tight and mixed ranges across the board as risk-appetite takes a breather while some data is still being assessed.
Domestically, equities have flourished lately with the S&P 500 Index rising seven out of the last eight sessions. Overnight, other regional exchanges also climbed with Europe’s Stoxx 600 Index up by about half a percent from good earnings from automakers while Asian stocks overall reached their best performance in over two weeks. Nevertheless, markets are hitting the pause button with questionable enthusiasm over the future of central bank policy. While the Federal Reserve is expected to be stimulative when they meet next week, some are wondering how much of a boost accommodative monetary policy will be to the economy.
Since FX flows are at the mercy of data yet to be released and the decisions to be made by various central banks, we are seeing action in other market classes such as Bitcoin, which has recovered in price, now hovering around $93K after being in the low 80s. At the time of writing, Jobless Claims along with Challenger Jobs Cuts gauges showed a bit better labor picture than expected. Available September figures for Factory Orders and Durable Goods will be out at 10AM. Resilience in the economy may push Dollar value higher, thus far, effect mostly muted.
What to Watch This Week…
- PCE Price Index on Friday 10AM
- University of Michigan Consumer Sentiment 10AM
- Monex USA Online is always open
EUR ⇑
The Euro’s momentum came to a halt after rising since the month started with a half-percent gain starting Monday. Today’s reading for October Retail Sales in the Euro-zone revealed things remained flat for consumption, however, the annual figure did rise from 1.3% to 1.5% primarily after an upward revision for September. Tomorrow will feature more data points in the form Q3 Gross Domestic Product and Employment. While the European Central Bank is not expected to cut interest rates, they will meet on the 18th and the tone and commentary from President Christine Lagarde will certainly move the needle. Next week’s focus for European data will be on prices.
JPY ⇑
The Japanese Yen is trading in stronger ranges, amongst the biggest movers in a morning without tons of FX movement. Another report about the Bank of Japan pointed at interest from officials to raise interest rates when they meet on the 19th, but this time it also showed that the government is happy to go a long with the likelihood of higher borrowing costs applied. A rate increase is almost guaranteed with chances now at over 90.0% that the move is coming. The Yen is now trading at the strongest level over the Buck since mid-November.
