The U.S. Dollar is trading in tight ranges this morning without a ton of movement across currencies. Much of the focus in markets will turn toward end-of-week data.
Overview
In terms of developments, the OPEC+ discussions have led member nations to agree to cut supplies, yet oil prices continue to stay under pressure as oversupply overshadows any potential for cuts to make an impact on demand. Recall that other energy venues are being explored by Europe as well as North America looking to be more energy-independent. Recent talks with Venezuela have aimed at getting them to side less with overseas opponents of U.S. policy.
Additionally, the globe is welcoming positive outcomes in Israel and Palestine where the truce has been extended as more hostages have been freed. Any progress in the conflicts will bode well for equities and shall inflict pain for the Buck. There may be some Fed member commentary today, but it will not be until the next few days we get to see if some data can move the needle.
What to Watch Today…
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EUR ⇑
The Euro has sustained its recent gains, keeping the ranges around the best levels since the start of August. While we will get some numbers towards the end of the week to truly affect the shared currency, we are seeing some fiscal happenings that could spark some growth for all industries. Italy has agreed to pass a €27.4MM budget to spend on green energy technologies, as a shift that the EU has been trying to make for years finally takes hold in the third largest economy of the union. We will see if the rest of the week the Euro manages to cross another multi-month high.
GBP ⇑
Sterling has remained in familiar ranges as disinflation continues and markets speculate over future monetary policy. Per the British Retail Consortium measure of retail inflation, the figure came in lower than expected at a pace of 4.3% instead of 5.2% estimated. Although price growth has been hit, Bank of England Governor Andrew Bailey has made vey hawkish statements saying that rate cuts are not under consideration. Nevertheless, markets are starting to price in an interest-rate reduction by August 2024.
