The U.S. Dollar is trading in tight ranges this morning, still weakened after yesterday’s major rally against it across all currency pairings
Overview
A report that tariffs under the incoming Trump administration would only target critical imports caused an uproar as markets seemed to welcome the news and punished the Buck for it. Nevertheless, we still have no clarity on what exactly will be pursued when it comes to levying new tariffs or in negotiating already-established agreements. It is a bit of a guessing game at the moment as excitement builds ahead of the inauguration.
While traders figure out the narrative, this week will have plenty of voices that will help in providing some guidance over monetary policy. Fed members such as Christopher Waller will be speaking at an event on Wednesday while others such as “hawkish” Thomas Barkin will do so Thursday. Tomorrow will also feature data in the form of ADP Employment as well as the Fed Minutes from December’s meeting.
What to Watch This Week…
- ADP Employment, Wednesday
- US Nonfarm Payrolls, Friday 8:30AM
- Monex USA Online is always open
EUR ⇑
The Euro was able to hold ground gained yesterday, but it lost momentum after the release of inflation figures earlier. The Consumer Price Index in December climbed by 0.4% and raised the annual average from 2.2% to 2.4%. Inflation has been difficult to overcome, particularly as energy costs are climbing for the first time since July. Confidence gauges and Producer Price Index will be out tomorrow.
CAD ⇑
The Canadian Dollar is trading tightly after improving against the Buck following Monday’s breaking news that Justin Trudeau would be resigning as Prime Minister of Canada. Indeed, the Liberal Party leader who has been around since 2015 is choosing to allow a new face to take over since losing popularity with approval ratings in the low 30s, percentagewise after surveys. Chrystia Freeland and Mark Carney, both experienced in Finance, are the most prominent names among potential candidates. Freeland was Trudeau’s Minister of Finance while Carney was governor for both Bank of Canada and the Bank of England.
