After trading in boring ranges yesterday, the U.S. dollar is on the upswing this morning with the exception being against the Japanese yen. The safe-haven greenback and yen found support as equity markets abroad ticked lower.
Equity market’s took step back yesterday as auto sales disappointed, possibly reflecting a large slowdown in consumer spending. A number of top tier data points are expected out today and could spark volatility. Factory orders are expected to have gained only 1.0% in February, down from 1.2% in January. Durable goods are forecast to show an expansion of 1.7% in February, maintaining the pace from the month prior.
There are a number of other risk events on this week’s schedule, including the release of the minutes from the last Federal Reserve meeting. President Trump will meet with the Chinese Premier on Thursday and some fear Trump might hold an accusatory tone. During his campaign, Trump said he would label China a “currency manipulator” but has not done so, yet. Friday’s Non-Farm Payroll will wrap up the week.
The Euro sank modestly overnight as French election risks returned to the spotlight. Indeed, the candidates for the French presidency will debate on television tonight. While it is unlikely, far-right candidate Marine Le Pen will win the presidency, tonight’s debate is seen as risky for the front-runner.
There is no further economic data slated for release in the Eurozone today.
The British pound experienced a steep decline, quickly, overnight before recovering some of its losses. The initial sell-off was sparked as data showed more signs of a slowing economy. The sterling lost 48 pips within four minutes.
U.K. construction data showed expansion in March, but at a slower pace than forecast. The sterling faces a tough road ahead with geopolitical risk, economic risk and Brexit uncertainty.