Dollar Bid as US Returns from Holiday Facing Many Questions

  • US-China tensions are coming back to the forefront; the dollar is getting some traction
  • The Senate returns to Washington today and a stimulus package seems more and more unlikely; the Fed media embargo went into effect Saturday
  • The next round of Brexit talks began yesterday in London; sterling has taken it on the chin; UK manufacturers called for an extension of the job furlough program
  • German’s external sector data disappointed somewhat; oil prices continue to trend lower with Brent falling for the fifth consecutive session
  • Japan reported a lot of data overnight; China-Australia relations have worsened Continue reading “Dollar Bid as US Returns from Holiday Facing Many Questions”

Dollar Firm as Data from Europe and Asia Disappoint

  • The dollar is getting some traction as data from Europe and Asia disappoint
  • Yesterday’s data support our view that the US economy is losing momentum; data highlight will be Markit preliminary August PMI readings
  • A group of former Fed officials came out in opposition to Judy Shelton’s nomination to the Board of Governors; Canada reports June retail sales
  • Eurozone preliminary August PMI readings disappointed; Brexit talks ended with officials sounding pessimistic; UK data came in better than expected
  • Japan data overnight was mixed; Australia reported preliminary August PMI and preliminary July retail sales; Korea reported trade data for the first 20 days of August Continue reading “Dollar Firm as Data from Europe and Asia Disappoint”

Dollar Steady as Ongoing Uncertainties Weigh on Equity Markets

  • The confusion continues and equity markets have taken notice; the dollar continues to stabilize
  • Talks on the stimulus package remain stalled; FOMC minutes did not reveal anything really new; the Fed sounds closer to finalizing its so-called Framework Review
  • Regional Fed surveys for August will continue to roll out; weekly jobless claims will also be reported
  • Germany will likely extend its job furlough scheme to 24 months; ECB releases the account of its July 15-16 meeting
  • Norges Bank kept rates steady at zero, as expected; Turkey is expected to keep rates steady at 8.25%
  • Japan reported weak July convenience store sales; Philippines kept rates steady at 2.25%, as expected Continue reading “Dollar Steady as Ongoing Uncertainties Weigh on Equity Markets”
The Dollar - Now What?

Dollar Steadies Despite Confusion in Trade Deal and Stimulus Talks

  • The status of the US-China Phase One trade deal has been called into question; the dollar is stabilizing today
  • The divergence between US equities and the dollar is the subject of much discussion these days; FOMC minutes will be released
  • There has been some confusion regarding the stimulus package; some observers see a potential opening in stimulus talks
  • Canada reports June wholesale trade sales and July CPI; Chrystia Freeland was named Finance Minister; UK reported higher than expected July CPI data
  • Japan reported weak July trade and June core machine orders; Indonesia kept rates steady at 4.0%, as expected Continue reading “Dollar Steadies Despite Confusion in Trade Deal and Stimulus Talks”
US Dollar Weighed Down by Dovish Fed Governors

Dollar Selloff Continues

  • US-China relations are on a two-track trajectory; the dollar remains under pressure
  • Reports suggest Senate Republicans plan to introduce a scaled back relief bill; it would likely be attached to a continuing resolution to avoid a government shutdown
  • Regional Fed surveys for August have started off on the wrong foot; July building permits and housing starts will be reported today
  • EU will discuss revamping its fiscal rules to help member nations address the pandemic; a sixth round of Brexit talks begin in Brussels
  • Turkey continues with its backdoor tightening; RBA released sobering minutes Continue reading “Dollar Selloff Continues”

Dollar Soft as Nations Worldwide Struggle to Contain Virus

  • The virus news stream remains negative; the dollar remains under pressure
  • Democratic lawmakers have been called back to Washington to address the postal service crisis; a stimulus package is unlikely until September, if at all
  • Regional Fed surveys for August will start to come out;
  • The UK labor market will likely come under further stress; Turkey signaled that tighter liquidity is here to stay
  • Japan reported weaker than expected Q2 GDP; Singapore announced additional fiscal stimulus; political tensions are rising in Thailand Continue reading “Dollar Soft as Nations Worldwide Struggle to Contain Virus”

Market Sentiment Worsens Ahead of Retail Sales Data

  • Market sentiment is ending the week on a sour note; the dollar remains under pressure
  • US July retail sales data will be the data highlight;
  • UK expanded the 14-day quarantine to travelers from France, the Netherlands, and Malta; eurozone Q2 GDP was unrevised; Poland and Hungary reported Q2 GDP
  • RBA Governor Lowe provided dovish testimony to parliament; Chine reported weaker than expected July retail sales and IP

Continue reading “Market Sentiment Worsens Ahead of Retail Sales Data”

Dollar Remains Under Pressure as Stimulus Deal Unlikely Before September

  • The dollar remains under pressure; there has still been no movement in stimulus talks; Weekly jobless claims will be reported
  • Fed officials are sounding increasingly concerned about the economic outlook; US Treasury wraps up its record $112 bln quarterly refunding
  • Mexico is expected to cut rates 50 bp to 4.5%; Peru is expected to keep rates steady at 0.25%
  • US-EU trade tensions may be improving; meanwhile, the US and UK are having a hard time progressing on their trade deal
  • Australia employment figures came in better than expected in July, but details weren’t encouraging

Continue reading “Dollar Remains Under Pressure as Stimulus Deal Unlikely Before September”

Dollar Under Pressure Again as Stimulus Talks Remain Stalled

  • Curve steepening in the major fixed income markets continues; the dollar is back under pressure
  • Stimulus talks remain stalled; the stage is now set for the November US elections after Joe Biden picked Senator Kamala Harris as his Vice President
  • US data highlight today will be July CPI; US Treasury continues its record $112 bln quarterly refunding; July budget statement will hold plenty of interest
  • UK Q2 GDP plunged -20.4% q/q and -21.7% y/y, slightly less than expected; eurozone June IP rose 9.1% m/m vs. 10.0% expected
  • Japan reported weak July machine tool orders; RBNZ unexpectedly boosted asset purchases while keeping the target rate (OCR) at 0.25%; Westpac Australia confidence for August plunged

Continue reading “Dollar Under Pressure Again as Stimulus Talks Remain Stalled”