The U.S. Dollar is trading in mostly favorable ranges, a change from the start of the week as renewed doubts over technology and large investments into A.I. have taken hold of equity markets.
Indeed, concerns have resurfaced that the payoff for such large injections into artificial intelligence may not be as fruitful as speculation has made some believe. As a result, Nasdaq 100 futures dropped by 1.2% while S&P 500 contracts fell by over half a percent.
Meanwhile, energy anxiety continues as no deal nor progress in negotiations have been reported from the U.S. and Iran talking. Brent Crude oil prices advanced for a seventh consecutive day with the strait of Hormuz still blocked. Naturally, the Buck is strengthening only as a safe-haven asset in the midst of uncertainty.
Ahead of the Fed’s meeting tomorrow, markets are at the mercy of headlines with investors and traders looking for some silver linings. Earnings may come in from large companies exposing troubles emanating from a longer-than-expected armed conflict that has made production of everything more expensive. Data showing where growth and affordability stand will be out Thursday. For now, U.S. Dollar is taking a reprieve after an April marked by losses to G-10 and across Emerging-Market tender.
What to Watch This Week…
- Monex USA Online is always open
EUR ⇓
The Euro fell along with other currencies as the nervousness continues with a ceasefire that is also keeping ships from smoothly sailing and trading. European leaders are feeling left out of talks towards a more permanent peace and looking to tackle the local issues with energy rationing. Reports have given European airlines scary timelines for running out of fuel. With economic stagnation a major problem, the shared currency can see some dwindling after recovering throughout the past month from a Dollar-strengthening March.
JPY ⇓
The Japanese Yen dropped in value like all other major peers despite some “hawkishness” from the Bank of Japan meeting that took place earlier. Overnight, markets seemed to take the news of no action as hesitation from BOJ officials, but the votes revealed a lack of consensus and willingness from a third of central bankers to raise borrowing costs. With 3 out of 9 wanting to address inflationary pressures right away, the odds for a hike taking place in June are increasing. While the theme seems now Dollar-friendly, this can change at any point.
