The U.S. Dollar is trading in tight ranges as markets wait for the FOMC announcement and press conference this afternoon at 2PM
Overview
News of White House willingness to meet and discuss trade as well as diplomacy with Chinese leadership at a meeting in Switzerland later this week is bringing back some enthusiasm across market classes. Equity futures jumped as the report impacted sessions overnight and the Buck was able to put an end to a three-day losing streak. U.S. Treasury Secretary Scott Bessent explained that while a new trade deal between the world’s largest economies seemed now unlikely, he wants to pursue de-escalation and argued that tariffs as they are do not seem sustainable.
Gold prices fell a bit while earnings from some big companies like Uber disappointed. Some economists feel that we are headed towards a slowdown and layoffs from market movers could spell bad news for the labor sector, which has been the backbone of the U.S. since the post-pandemic recovery. There is also growing concern that the U.S. may not get more concessions via tariffs. Additionally, inflationary worries are emerging, which will be addressed by the Fed Chairman Jerome Powell when he gets questioned. We shall see how today’s statements shape the narrative.
What to Watch This Week…
- FOMC TODAY 2PM
- Bank of England Meeting Thursday
- Monex USA Online is always open
The complete Economic Calendar can be found here.
MXN ⇑
The Mexican Peso improved over the Buck as news out of the U.S. boded well for the future of trade between the two countries. Both countries seem to be willing to work with one another even after Mexico’s leadership firmly rejected a proposal to have U.S. troops cross Mexico to aid in combatting crime from cartels. Mexico’s Foreign Ministry responded with a statement saying, “Mexico complies with international agreements, but sovereignty is non-negotiable.” It seems like the most important of those agreements, USMCA trade pact, is considered “effective” according to President Donald Trump. He followed by saying that it needs to be fully complied with and abided to. Fed talk will also play a big role in moving MXN later today one way or the other.
CAD ⇓
The Canadian Dollar is mostly flat at the moment, but it has been alternating between gains and losses since April 22nd. Yesterday saw the new Canadian Prime Minister, Mark Carney, visit the oval office to discuss trade and to make friendly after a change of the guard with Justin Trudeau no longer around. Carney stated post-meeting that he found the talks constructive in their tone, but that it is going to be difficult to gain much traction if the U.S. does not lower the tariff levies implemented outside of USMCA. His U.S. counterpart explained that there was no desire to lift tariffs right now.
