Daily Market Update

U.S. Dollar Keeps Upward Momentum Ahead of Iran Deal Speech

May 08, 2018

The U.S. Dollar is trading in favorable ranges, maintaining its climb to its best levels of the year and beyond against some currency pairs.

USD

For example, the Swiss Franc stands at its weakest level since June 11th, 2017. Commentary from Federal Reserve Chairman Jerome Powell aided in further advancing the greenback after saying at a conference in Zurich that the markets are “well aligned” with the Fed’s rate hike outlook. He said normalization is not disrupting financial markets, a positive dollar statement.

Job Openings in the form of JOLTS will be out at 10AM, but other than that there is no significant data to analyze. Today marks an important day as President Donald Trump plans on deciding the fate of the Iran Nuclear Deal at 2PM. Some market participants feel anxious about what this could mean for global stocks and we foresee impact on commodity-based currencies, which are already sliding on the likelihood of the U.S. abandoning the deal.

 

EUR

The Euro will remain subdued as mixed data served as reinforcement of the idea that the European Central Bank will not be looking to tighten their monetary policy anytime soon. German Industrial Production increased by 1.0%, finally expanding instead of contracting like the past two months. Nevertheless, Inflationary growth in the Netherlands and Spain remained quite low per Consumer Price Index figures for the two nations. Trouble in Italy continues as leaders from all parties see no coalition building based on fear that technocrats are taking over the government. It is worrisome, but no sign of new elections yet. Maybe soon though.

 

GBP

The Pound continues its rapid fall as Brexit concerns grow larger and an assessment of individuals’ money assets revealed an awfully low level of wealth. The money supply in British bank accounts is at a low level according to economists. If spending is what drives the economy, this makes it seem as if there is not much to be spent by consumers. Sterling is at its worst level of the year against the buck.

 

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