Daily Market Update

U.S. Dollar only slightly down to end the week

April 12, 2019

The U.S. Dollar slipped as overnight market activity witnessed Asian as well as European stock exchanges go into green territory.

Overview

The cause was simple: good credit data out of China that went in line with U.S. banks beating expectations. Although the buck has gained recently because of doubts over the global economy, it is currently vulnerable to the idea that if the globe starts recovering and the slump fades as expansion in indicators come, all other counterparts will appreciate. Indeed, the safe-haven mentality is at play and good news for other regions will not bode well for the greenback.

Per the Bloomberg Dollar Spot Index, this is the lowest point for the currency in two weeks. Without any major data, we are at the mercy of flow of Friday news as well as speculation on Brexit as well as new bilateral trade talks that will take place between the U.S. and Japan. Clearly, Japan does not want to have tariff issues and Shinzo Abe, the Prime Minister, has maintained a close relationship with the White House. Perhaps those talks will be filled with less uncertainty.

 

What to Watch Today…

  • No major events scheduled for today.

Complete Economic Calendar can be found here.

 

EUR

The Euro jumped by over half a percent overnight, its largest jump in eleven weeks based on the dollar weakening started by good data in other regions. Much of the Euro’s hopes for increasing in value will be based solely on an improvement to the real economic data numbers that have recently shown a contraction in major economies like Industrial Production and Retail Sales in Germany and France. Not to mention, Italy must climb from a technical recession.

As budgets and trade concerns bug the continent, expect these friendly and favorable ranges to have a very limited lifespan. We foresee better things for Euro especially towards the end of the year, but these swings are here to stay.

GBP

The Pound is trading in familiarly weak ranges as Brexit strategies become the focus prior to the Halloween deadline. There is little chance of much of a holiday on this issue as the summer will bring pressure on elected officials to vote on the issuance of a second referendum. France and Germany have expressed dismay at the need for a delay though they now deem it necessary. However, the EU is likely not going to budge much in terms of changing what they have handed May.

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