Daily Market Update

Dollar Under Modest Pressure on Dovish Fed

November 19, 2018

The U.S. dollar is under modest pressure this morning, continuing momentum from late last week which saw the greenback sell-off against most of its major rivals.

Overview

A number of Federal Reserve officials held slightly dovish tones last week which caused investors to marginally bring down interest rate expectations for December and 2019 generally. Investors will look to a speech by New York Fed President John Williams today to see if he will continue the recent trend of dovish Fed-speak.

There is no major economic data set for release today. The week as a whole is fairly light and we expect choppy ranges ahead of the Thanksgiving holiday on Thursday. Housing starts will cross the wire on Thursday, followed by Durable Goods and consumer sentiment on Wednesday. All US markets will be closed on Thursday and Markit service and manufacturing PMI will round out the week on Friday.

 

What to Watch Today…

  • NY Fed President John WIlliams speaks at 10:45 AM

The complete economic calendar can be found here.

 

NZD

The Australian and Kiwi dollars have been collateral damage in the intensifying trade war between the United States and China. Vice President Mike Pence and Chinese Leader Xi Jinping both gave contentious speeches at the Asia-Pacific Economic Cooperation summit in Papua New Guinea. Pence said that the U.S. isn’t in a rush to end the trade war and wouldn’t “change course until China changes its ways.” The New Zealand dollar fell nearly a percent and the Australian dollar dropped 0.5% of value against the U.S. dollar.

GBP

The sterling popped higher overnight before seesawing between gains and losses in early trading as Brexit headlines continue to dictate trade. Prime Minister Theresa May is attending the Confederation of British Industry annual conference in London today. She has argued that her Brexit deal would give Britain “control over our borders.” Whether May can win over the business community is second fiddle as she faces a seemingly insurmountable opposition in Parliament.

 

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