The U.S. dollar is mostly flat to start the day after experiencing a sharp rally during yesterday’s session.
Overview
The safe-haven greenback benefited from a flight to safety as global equities faced a massive sell-off. American equities experienced their worse day since the beginning of November yesterday, and the pain looks to continue today. Equity futures are deeply in the red this morning, but the U.S. Dollar has struggled to take additional advantage. Data this morning will lend credence to global recession fears currently driving markets. S&P Global Purchasing Managers’ Indexes all failed to meet expectations. The Composite PMI came in at 44.6, failing to meet expectations of 46.9. A reading below 50 indicates contraction. Both Manufacturing and Service PMI failed to meet forecasts.
What to Watch Today…
- No major economic events are scheduled for today
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EUR ⇑
The Euro is mostly unchanged overnight versus its U.S. rival. The Euro dipped half a percent against the U.S. dollar yesterday, but by comparison to other G10 currencies, the Euro was resilient. The Euro initially saw major support and popped to the highest level since June after the European central bank warned that interest rates still need to go higher. Ultimately, the Euro succumbed to widespread dollar strength.Despite the small pullback yesterday, the Euro has experienced an impressive 9.0% rally against the U.S. dollar since early November.
GBP ⇓
Sterling fell nearly 2 percent against USD yesterday after the Bank of England took a more-dovish-than-expected tone on its 50 basis point interest rate hike. Lots of USD safe haven action has kept GBP depressed this morning after a slew of central bank meetings this week.
