The greenback fell modestly overnight and fell against a handful of its counterparts, ceding the most ground to the Japanese yen.
Nevertheless, overall the greenback remains within 0.2% of its strongest level of the year according to the Bloomberg Dollar Index.
Commodity-based currencies such as the Australian dollar and the Norwegian krone dropped as the price of oil fell to a one-month low. Saudi Arabia’s energy minister said they cannot rule out boosting output by as much as two million barrels per day.
President Donald Trump again promised middle class tax cuts and provided more detail. He has promised an additional 10% reduction for middle income families two weeks before the mid-term elections.
There is no major economic data set to be released today, but there are a few Fed speakers that warrant our attention. In the afternoon, the Fed’s Bostic will speak on the economy and monetary policy and Dallas Fed President Kaplan will speak on economic development.
The Japanese yen was the biggest winner overnight, benefiting from safe-haven flows as Asian stocks reversed yesterday’s gains. China’s Shanghai Index dropped 2.3%, erasing some of its impressive 4.1% gain yesterday. The Euro Stoxx 600 was also lower and S&P futures point to a lower open.
The British pound was in modest recovery mode overnight after falling nearly a percent against the U.S. dollar yesterday. The Irish border issue continues to weigh on the sterling and Brexit negotiations in general. May gave an update on the Brexit negotiations to an angry and frustrated Parliament yesterday. May’s leadership is hanging on by a thread and there are increased rumblings that she may find herself on the way out as soon as the end of the month.