The U.S. Dollar is trading in tight ranges, primarily weaker against commodity-based currencies as a bit of risk-on sentiment.
Overview
All three major stock exchanges are looking to advance. This week has been characterized by concern over just how soon tightening will come from the Fed and other central banks. The last two years of the pandemic have also witnessed record-breaking levels of success for equities, earning more than expected and being fed by the assurance of easy-money in a very accommodative financial environment. Uncertainty is the dominant theme at the moment with Omicron seeming to fade away as winter keeps rolling on with strong weather causing delays.In terms of data, Initial Jobless Claims surged a bit more than expected while Continuing Claims also surged. The Philadelphia Business Outlook did post a higher reading than expected and we have Existing Home Sales at 10 AM. We shall see if oil markets are rattled and cause any movement for petrocurrencies after the International Energy Agency oil inventory report.
What to Watch Today…
- Existing Home Sales 10 AM
TOP SPOT AGAIN! | #1 G10 Forecaster for 6th Time
Bloomberg ranks Monex USA (formerly Tempus) for top G10 Forecaster, NZD, CHF, AUD, MXN, and GBP! Learn More
EUR
The Euro has been steadily giving up its gains as it becomes clear that there is indeed central bank policy divergence between the U.S. and the Euro-zone. Regardless of recent statements from voices supporting an eventual interest rate hike in 2022, European Central Bank President Christine Lagarde stated that the ECB has “every reason” not to act in the way the Fed wants to in order to combat inflation.Lagarde explained in an interview that the ECB simply is not in the same situation of economic growth the U.S. is in, thus she perceives a great risk to increase borrowing costs for the Euro-zone this year. Per Lagarde, current rising yields are just a sign of fundamentals improving like they need to. Euro will certainly be tested.
GBP
Pound Sterling is not on the rise but could find a reason to strengthen following yesterday’s good inflationary data and progress in handling the pandemic. Per Prime Minister Boris Johnson, work-from-home orders and vaccine passports will be a thing of the past starting next week. In a speech explaining the move towards leniency, the head of state said that life in the pandemic should now be left to the better judgment of the people. Traders expect a good chance for appreciation next week.
Ready to spin the currency market moves in your favor?
DISCOVER HOW WE CAN HELP YOU SEND or RECEIVE PAYMENTS
