The U.S. Dollar has improved across the board this morning going along with treasury yields as well as equity futures.
Overview
The globe is ultimately weighing the different stances that major central banks are taking, particularly Jerome Powell who defended the Fed’s loose monetary policy to the House and Senate this week explaining that the current state of heightened inflation is just a result of a massive recovery of the economy is undertaking.
As such, he strongly believes the Fed should not be considering tapering its bond purchases and other emergency measures until maybe the end of the year. Furthermore, markets are left to wonder if the Fed’s lack of consensus will be hurting the buck long-term since other central bankers seem ready to start taking some of the aid away from the financial environment.
Meanwhile, stocks keep testing new record highs and the swings for the buck continue with a week with so many swings that ultimately represented barely a half percent uptick in value. Oil prices had their worst weekly performance since March as OPEC+ uncertainty keeps production targets up in the air.
We shall see how things progress with recent increases in COVID infections with Los Angeles reported to want to require masks indoors again after an awful flare-up has returned. At the time of writing, Retail Sales for June revealed growth at a pace three times higher than estimated at 1.3% over the 0.4% expected.
What to Watch Today…
- University of Michigan Consumer Sentiment 10 AM
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EUR ⇓
The Euro has fallen by over half a percent this week after the announcement of a new Green plan for getting rid of emissions in the region by great levels in 2030 and completely in 2050. Many business leaders and the typical EU opposition governments, such as Hungary and Poland, are already complaining about the unrealistic targets and the work needed to meet regulations that could delay productivity, thus hurt profits.
This comes at a time when the EU wants to spend a lot of money to become environmentally better and gain energy independence. Also, economists are waiting for the ECB to clarify that they will not be taking any assistance off of the financial environment any time soon when they meet next week. Expect volatility to cause plenty of fluctuation for the shared currency as they mix holiday with reforms.
NZD ⇑
Focusing on some other currencies, the New Zealand Dollar did not succumb to the buck’s advancement this morning as this nation’s central bank is looking towards tapering and got the evidence they needed in the form of higher-than-expected inflation. Indeed, the RBNZ’s goal target has been breached for the first time in ten years going past 3.3%. The pace is twice what it was the month prior. We shall see if the geographic separation that Oceania has will keep them safe from the high levels of infection being recorded in Asian nations.
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