Dollar Up on Risk Focus

The U.S. Dollar is trading in positive ranges against its G10 peers this morning as geopolitical risk continues to dominate the headlines.

The United States seized two Russian-flagged ships in the Atlantic for sanctions violations yesterday, with Secretary of War Pete Hegseth stating that the blockade of Venezuelan oil remains in place “anywhere in the world.” Meanwhile oil prices are holding just above their post-2021 lows as plans for the sale of Venezuelan oil by the U.S. start to solidify and Secretary of Energy Chris Wright stating that the U.S. intends to remain in control of the sale of Venezuelan oil indefinitely.

We received the ISM Services Index for December yesterday morning, which printed at a 14-month high, signaling to Traders that the economy ended the year in a relatively strong position, and November’s JOLTS report, which showed that layoffs had fallen to a 6-month low, suggesting that the labor market is headed in the right direction. This is also supported by the fact that Initial Jobless Claims for the week ending January 3^rd came in slightly below expectations this morning. Non-Farm Payrolls tomorrow will give us the best indication of where things stand, and we remain focused on that data point.

What to Watch This Week…

US Nonfarm Payrolls, Friday 8:30AM
Monex USA Online is always open

The complete Economic Calendar can be found here .

AUD ⇓

The Australian Dollar is the G10’s biggest losers against the Greenback this morning after hitting a fresh one-year high yesterday. In an interview yesterday, Reserve Bank of Australia Deputy Governor Andrew Hauser admitted that inflation remains “too high,” but indicated that the RBA would be taking a one-to-two-year view on monetary policy rather than reacting to individual data releases, thereby souring Traders on the potential for a February interest rate hike.

GPB ⇓

The British Pound Sterling is down more than a quarter of a percent against the Buck this morning, marking a third straight day of decline. Data is light, but our focus will continue to be on the labor market, which is likely to remain soft for the time being. While the potential for a rebound in the data is there, it is hard to bullish on the Pound as we currently stand.

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