Daily Market Update

Dollar Falls From Three Week High

April 03, 2019

After reaching a three-week high yesterday, the U.S. dollar is on the defensive this morning.

Overview

There is fresh optimism over a Chinese trade deal which has allowed global equities to rally.  Chinese Vice Premier will resume negotiations today in Washington.  A gauge for Chinese services rose in March, following strong manufacturing data earlier in the week.

This morning’s economic docket might spark a little more volatility.  ADP private payrolls showed a disappointing 129K private jobs were added in March, missing estimates of 175K gain.  Later, Markit’s and ISM service data will cross the wire and will hope to match the positive results in Europe and China.

 

What to Watch Today…

  • ISM-Non Manufacturing and Markit Service Data

Complete Economic Calendar can be found here.

 

EUR

After flirting with a 21-month low yesterday, EUR/USD is on the rise for the first time in a week.  Euro is likely to remain under pressure but has found some relief on general dollar weakness on diminished safe-haven demand. The economic docket provided some rare good news as the Purchasing managers’ indexes for services beat expectations.  Manufacturing data released earlier this week was disappointing. German bonds also fell, with the 10 year slightly rising back above 0.0%.

GBP

The Sterling started to rally late yesterday after Theresa May offered to conduct cross-party talks to find a Brexit solution.  However, if you had not looked at currency markets since early last week, you probably could not tell that GBP/USD has swung wildly over the last four sessions.  Talks between Conservative and Labour leaders are set to take place today.  Traders are pricing in a possibly softer-Brexit which has boosted the sterling.  The two parties are aiming to have a deal ready by Friday, which seems to be a tall order considering it has been nearly three years since the U.K. voted to “Leave.” Headline risk will prevail today.

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