After sustaining fairly heavy losses through Friday’s trading session, the United States Dollar starts this week on the front foot.
Overview
As no major data points were released this morning, it appears USD is on a bit of a correction course from Friday. Global risk sentiment soured a bit over this weekend on speculation that additional economic stimulus may be needed in China after consumer inflation showed June prices were unchanged throughout the nation. Fears of deflation, a step beyond disinflation, are rebounding in the global economy on this print and driving some strength behind USD.
With a quiet calendar to begin this week with the exception of a couple of speakers from the Federal Reserve, USD action will begin to pick up Wednesday morning with the release of US CPI data for the month of June. This is the last major data release that Fed officials will be able to publicly comment on before the media blackout period begins ahead of the Fed’s meeting on July 25-26. Expectations have already been set for a hike at this meeting, but any downside inflation could prompt speculation of another skip and weaken the Dollar.
What to Watch Today…
- No major economic events are scheduled for today
- Monex USA Online is always open
Holiday Donation Results – Thanks for Helping!
Earlier this year, Monex made a donation in honor of your continued trust in us for your FX needs. We’re happy to report that each charity received a percentage of an overall amount based on your votes. Thank you for participating! View Results
Monex USA introduces OPTIONS
With currency exchange rates in a constant state of flux, companies transacting cross-border face the risk of losing substantial sums of money if they fail to hedge their exposure to these shifts. Monex USA now offers a wide range of FX options that could help your business better manage risk. Learn More
GBP ⇓
In a sharp reversal from Friday, Pound Sterling is down more than half a percent against USD this morning ahead of a scheduled speech from Bank of England Governor Andrew Bailey today. Over the weekend, Bailey rejected calls for an inflation target above 2%, a number that some have come to see as an unrealistic goal given the larger state of the UK economy. A survey also suggested that hiring pressures are easing as the number of job candidates rose at the fastest pace in more than two years, a good sign for the Bank of England.
AUD ⇓
Dim news out of China over the weekend has driven the Australian and New Zealand dollars down against the Buck in tandem, with AUD taking a loss of more than three-quarters of a percent to open the week. Commodity prices also slipped along with risk sentiment, giving further weakness to the Antipodeans. Though undoubtedly a large slip, after AUD posted a gain of 1% on Friday, this kind of retracement is within the bounds of similar action from other major currencies today.
