The U.S. Dollar is trading in tight ranges, particularly staying within a half-percent range band against the G-10.
Overview
The markets are still digesting the data from this week that serves for mixed interpretation about chances of an economic recession in the future.With the economy not expanding, much like the Fed desires, some are hoping officials slow the pace of interest rate hiking. On the other hand, many feel the Gross Domestic Product figures from Q4 only serve as evidence of an economy that still has room to decline, thus some fear about a stubbornly hawkish Fed.Today’s inflationary data in the form of Personal Consumption Expenditures revealed a slight 0.1% when no price growth was expected. However, it has slowed down significantly in months. Later at 10 AM, we will get the University of Michigan Consumer Sentiment Survey. The Fed meeting next week will be the biggest risk event to look out for.
What to Watch Today…
- No major economic events are scheduled for today
- Monex USA Online is always open
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EUR ⇓
The Euro has been tight in recent days as economic indicators have markets wondering about the potential for a more growth-oriented 2023. The U.S. situation serves as a guide for future central bank policy to come, but no matter what, it seems like the European Central Bank wants to take the lead when it comes to tightening and reviving interest rates.
It is important to remember that rate increments were dormant as an accommodative policy that included rates in the negative percentage territory to foment lending and banking activity. Much of what can push the Euro upward for the remainder of the year relies on increased bets for higher interest rates starting with two 50bps hikes coming up.
GBP ⇓
The sterling is dropping in value as concerns grow over the lack of economic momentum as the government explores ways to aid businesses. It is the first weekly loss for Pound since the year began. A speech by Jeremy Hunt, Chancellor of the Exchequer, explaining the way the government hopes to stimulate the economy without cutting taxes failed to impress markets. It is also likely officials from the Bank of England will be questioned about the likelihood of cutting rates later this year.
