The U.S. dollar is up against most of its major rivals this morning with the notable exceptions being the Mexican peso and Norwegian krone.
Overview
The dollar has made the most significant gains against the Euro after the European Central Bank gave its strongest signal yet that monetary support is coming in September.
The domestic economic docket will also allow the greenback to extend gains. Durable goods orders marked their biggest gain in more than a year perhaps showing an uptick in business investment. Total orders rose 2.0% in June, beating expectations of a 0.7% gain. But all is not roses either as last month’s disappointing reading was downwardly revised to a 2.3% contraction. Non-military capital goods orders excluding aircraft did post an impressive 1.9% gain in June.
There is no further domestic data slated for release today so attention will likely quickly shift back to Europe and Mario Draghi’s press conference.
What to Watch Today…
- Draghi’s Press Conference continues
EUR
The common currency came under pressure once again as the central bank gave a strong signal that the ECB will have to add monetary support in September. Much of the European Central Bank’s dovishness has been priced in since last month’s summit in Sintra, Portugal. But it appears the common currency has room to fall a bit further. At the time of writing, ECB President Mario Draghi is holding a press conference in which he reiterated his dovish outlook. He said again that significant monetary stimulus is needed and that geopolitics and protectionism are damping sentiment. He also said that the outlook is “Getting worse and worse.”
CAD
The Canadian dollar bucked the trend of U.S. dollar strength and gained overnight as the price of oil rose 1.5%. If the loonie can hold its gains, it will be the first session in five. Canada’s GDP will be released next week.
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