Previous Day's Market Highlights
The dollar hit new 2018 highs against the euro and the pound last week. Euro-dollar fell towards 1.17 and sterling-dollar towards 1.34. The dollar strengthened amidst some positive data and upbeat Fed statements, while weekend comments from US Treasury Secretary Mnuchin that the trade war with China is on hold saw further gains.
The euro came under pressure in part due to concerns over Italy’s populist coalition government and as data found that Q1 GDP and April inflation had slowed as initially estimated. Dollar strength was also a downwards pressure.
Mixed labour market data did little for the pound, while gains on reports that the government would seek to stay in the Customs Union after 2021 were shortly reversed after the government denied the reports.
|Currency Pairing||08:00 Today||Vs 08:00 Yesterday||Four-Week High||Four-Week Low||% Change|
Today's Market Highlights
Today is a holiday in Canada for Victoria Day and in France, Germany, and Switzerland, among other countries, for Whit Monday. The calendar is fairly light, which will keep market attention primarily on any political headlines, this evening’s Fed speeches, and continued dollar strength. This may keep rates around current levels.
Looking ahead, tomorrow the UK releases April CPI data. Headline inflation is forecast to have softened further, slipping to 2.3% from 2.5%. This may further push back BoE rate hike expectations.
The Fed and the ECB both release monetary policy meeting accounts, which investors will watch for any further nuance—on the Fed side, as to the likelihood of a fourth hike, and on the ECB side, as to the timing of the final QE winddown. Other UK data out this week include Retail Sales and the second estimate of Q1 GDP, which will be closely watched for any revisions higher. BoE Governor Carney and Fed Chair Powell will participate in a panel on the future of central banking on Friday.
Today's Economic Calendar
|13:30||USD||Chicago Fed National Activity Index (Apr)||0.14||0.10|
|17:15||USD||Fed Member Bostic Speaks|
|19:05||USD||Fed Member Harker Speaks|
|22:30||USD||Fed Member Kashkari Speaks|