The U.S. Dollar is trading in mostly tight and familiar ranges as markets weigh the possibility of facing a U.S. government shutdown as we close down the third quarter of the year.
Overview
Stock futures are down as investors start getting concerned with potential disruption to the economy if indeed the U.S. Congress fails to get a deal done to avoid the pain of not paying their bills. Seems like markets are in a bit of “sell everything” mode with Gold reaching new record highs. It has surged by over 10.0% this month, serving as a new safe haven while also being pumped by Chinese investment. The world’s second-largest economy will begin Golden Week holiday celebrations tomorrow.
Although there is a bit of sluggishness across markets, September is set to be the best September for the S&P 500 Index in 15 years. Optimism and profits for tech have fueled the good run, along with the feeling that further stimulus to the financial environment will come down the line. While there will be JOLTS Job Openings figures for August released at 10 AM, tomorrow we will wait for ADP Employment Change, and see if it helps forecast the official number for Friday. Purchasing Managers’ Indices will also be featured on Wednesday.
What to Watch This Week…
- Euro-zone CPI, Wednesday
- US Nonfarm Payrolls, Friday 8:30 AM
- Monex USA Online is always open
EUR ⇑
The Euro is not moving a ton today without any significant data out and all eyes on the U.S. as it works out domestic as well as geopolitical concerns. The government shutdown possibility is something that could turn things sour for the dollar and boost all major peers as a result. A big peace proposal was announced in a meeting between Israel and the U.S. that some European nations are supporting. While European PMIs will be out on Thursday, tomorrow we will watch for inflation in the form of the Consumer Price Index for this month. We shall see if any wild moves drastically change the direction of the shared currency, which has climbed by 0.75% thus far.
MXN ⇑
The Mexican Peso is rising a bit as September approaches its end, with some key indicators to be released. Tomorrow we will get PMIs and Remittances Totals, while on Friday we close with measures of private consumption and investment. There will be some talk about a central bank survey in which perhaps “hawkishness” from the previous meeting establishes that Banxico may hesitate to keep slashing interest rates.
