The U.S. Dollar is up this morning, improved vastly against various currencies as the American economy keeps providing evidence of a solid footing.
Overview
The second revision of Q4 Gross Domestic Product came in at 3.2%, only slightly off the 3.3% expected, while Personal Consumption climbed by 3.0% instead of the 2.7% forecast.
Additionally, the Fed’s preferred method of measuring inflation in the form of Core Personal Consumption Expenditures was revised upwardly from 2.0% to 2.1% . It was the largest increase in a year. These numbers further cement the idea that the Fed will not be rushing to cut interest rates any time soon. Thus far, officials this week have echoed a message of seeing lowering rates as unnecessary for now. This is all serving as a natural Dollar-booster.
There is still data to chew tomorrow in Consumer Income, the PCE Deflator, and Jobless Claims. On Friday, Construction and Manufacturing gauges will be released along with the University of Michigan Consumer Confidence survey. It is worth noting that while talks of Market concentration are taking over the market, Bitcoin is rising and has surpassed $60.0K per coin.
What to Watch Today…
- PCE Deflator, Thursday
- Euro-zone CPI, Friday
- Monex USA Online is always open.
EUR ⇓
The Euro started falling following the strong economic indicators from the U.S. and the lack of optimism in Europe. As the U.S. continues to differentiate itself from the rest of the global economies by growing and seeing better consumer sentiment, the opposite is happening on the other side of the Atlantic. Consumer, Services, Industrial, as well as Economic Confidence surveys for February all came in more negative than thought.
After we experience the leap year tomorrow, Friday will bring February’s Consumer Price Index, Manufacturing PMIs, and the Unemployment Rate. Next week with a plethora of data, the shared currency’s steadiness will be truly tested and thus far it would be a surprise if Euro can stay afloat.
NZD ⇓
The New Zealand Dollar suffered a collapse after the Reserve Bank of NZ refused to increase interest rates at their meeting, defying what was supposed to be tightening bias going into this year. Affected by shipping and conflicts more than other regions, the Oceanic nations of Australia and New Zealand had to tackle more inflationary pressures than others and have telegraphed moves to tighten policy. Nevertheless, inflationary concerns are fading as disinflation is starting to manifest. While officials believe policy shall remain “restrictive” for now, they are not seeing the need to raise interest rates. The 1.2% drop in currency value only means “Kiwi” is at its weakest point in over two weeks.
