The U.S. Dollar is trading in stronger ranges to close out an eventful week in which it has lost over half a percent of value against majors per the Bloomberg Dollar Spot Index
Overview
Meanwhile, markets have been flourishing on the basis that trade deals are being signed and corporations seem to be doing Okay after months of many changes to norms and pressures over trade alignment.
The S&P 500 Index climbed 1.2% in the past week, however, it lost momentum yesterday after having experienced 10 record highs within the last 19 days. Not all earnings impressed with big tech in Intel sinking after its report along with textile giant Puma. Next week will be the busiest for the earnings season as 38.0% of the S&P 500 on a market cap basis is due to show its results.
In terms of economic data, today’s release of July Durable Goods Orders impressed with the print higher than expected while prior month’s figures were also upwardly revised. July’s numbers came in showing an expansion of 0.2%, double the 0.1% forecast while the original June reading of 0.5% was changed to 0.6%. Investors are starting to wonder if the good run in America will mean a more “hawkish” stance from the Fed, thus keeping them from lowering borrowing costs by slashing interest rates, which is what the markets truly want. We shall see also if in the next days we hear about progress in the tariff-negotiating front with China, who is seeking to extend the deadline beyond August 12th.
What to Watch This Week…
- Monex USA Online is always open
The complete Economic Calendar can be found here.
EUR ⇓
The Euro has been gaining some ground back this week after falling the week prior, thus far taking back around 1.0% of its value. The European Central Bank this week decided to keep monetary policy intact after being stimulus-driven for over a year and gave themselves a pad on the back for controlling inflation, which is now hovering around 2.0% as desired for the Euro-zone. Next week we will have a look at a plethora of data points with surveys over inflation, confidence gauges, Gross Domestic Product for Q2, as well as Unemployment. If everything is in favor, expect Euro to have room for further appreciation.
MXN ⇓
The Mexican Peso is moving in tight ranges after reaching its strongest value against the Buck since August of last year. Just like the Europeans, Mexico’s leaders are hoping to make progress in reaching agreement with the U.S. in order to avoid the implementation of higher tariffs across all products. Domestic performance will be tested as next week brings us GDP, Trade Balance, Manufacturing and Remittances numbers for review. A healthier situation than expected could indeed bring Peso levels to new historical highs.
