The U.S. dollar is mostly lower this morning but mixed depending on the pair.
The greenback is up against the Japanese yen as the risk mood is up as earnings season kicks off and as the West has not retaliated against Syria (yet). Commodity prices are largely higher today benefiting the Australian and Canadian dollars.
Later this morning, consumer sentiment will cross the wire and represents the last major (scheduled) risk event. Economists are expecting the University of Michigan report to show a slight decrease in sentiment to 100.5, down from 101.4 in March.
We will continue to watch geopolitical developments including progress on NAFTA negotiations, further news on President Trump’s apparent willingness to relook at the Trans Pacific Partnership and possible attacks on Syrian targets.
The Canadian dollar is set to be the top-performing currency of the week. Other commodity-based currencies followed suit, as Aussie and Kiwi are second and third, respectively. The loonie has been buoyed by a rise in commodity prices, namely WTI oil which reached a three year high earlier this week.
The Japanese yen is set for a third weekly decline versus the U.S. dollar has the risk environment has improved. While European data continues to be soft, the trade rhetoric between the U.S. and China seems to be thawing. In fact, President Trump has expressed an interest at potentially re-entering TPP. In addition, the U.S., France and the UK have yet to respond to last week’s Syrian chemical attack. As a result, the Japanese yen has fallen to its weakest level since February 22nd.