fxs_header_sponsor_anchor

News

Forex Today: dominated by US political uncertainties and a change of mood in the dollar

Forex today was dominated by US political uncertainties, a weak dollar and a modest narrowing of the yield gaps across the G7's .The yen picked up the majority of the bid in that respect along with the euro. 

There was some follow-through from last nights less dovish rhetoric from BoJ's Kuroda supporting a retracement to back below the 113 handle. The euro rallied to the highest levels since last Nov while the commodity currencies got a free ride on the dollar weakness as well. 

The US economy is shaping up to be less appealing to global investors who are now looking offshore in such markets as the EM's. There are doubts over the ability of Wall Street to continually run on hot air and Trump's "make America great again" comes under scrutiny as political uncertainties get in the way. Data continues to let investors down and in stark contrast to what the Fed officials have been expecting, (except IP was the strongest in three years today). 

Markets shrugged off the US IP data and instead reacted to offshore positives, such as euroland GDP and German ZEW. The dollar also got a hit on political uncertainties around Trump/Russian relations and poor US housing data that surprised to the downside. US yields dropped to test the 2.3% psychological level, a game changer for the dollar and the DXY is finishing the day around 0.80% lower for a YTD return so far of nearly -4%. 

GBP/USD was good two-way business between 1.2866 and 1.2958. USD/JPY is down -0.65% between a range of 112.93-113.80% for today, currently testing 113.00 again. The Candian dollar (-0.35%), Aussie (+0.26%) and Kiwi (+0.10% weighed slightly by GDT price index miss -0.4% vs expectations) all got a boost from the commodity sector ramping up gains. Gold is also up on the day, +0.53%.

The day ahead:

While there are key events in Europe in UK jobs data dn EZ CPI, there is very little on the cards from Asia although some possibilities in second tier data as follows:

Key notes from the US shift:

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.