Here is what you need to know on Monday, May 3:
The US dollar has kicked off May with minor gains against major but retreats against commodity currencies. The ISM Manufacturing PMI is eyed as the first Nonfarm Payrolls hint and EZ figures are also of interest, despite holidays in Europe. Ethereum is trading above $3,000 for the first time.
Last week's robust Gross Domestic Product, Personal Income, and Personal Spending figures from the US keep the greenback bid against the euro, pound, yen and also the Canadian dollar, as WTI Oil falls to around $63. Demand for the dollar comes despite a slide in Treasury yields, with returns on 10-year bonds falling to 1.63%.
Robert Kaplan, President of the Dallas branch of the Federal Reserve, said that the bank should begin talking about tapering soon, a more hawkish view than Chair Jerome Powell's flat-out rejection of such a move. Concerns of bubbles have been floating, yet S&P 500 futures remain close to record highs.
Can the Fed keep US rates in check?
Markit's final Manufacturing Purchasing Managers' Indexes for April are set to confirm upbeat prospects for the eurozone economies as the vaccination campaign picks up.
A bank holiday in the UK does not prevent political speculation from weighing on sterling. UK PM Boris Johnson is under pressure for asking Conservative Party donors to fund a redecoration of his Downing 10 residence.
The US ISM Manufacturing PMI for April is set to exceed April's high 64.7 scores, showing strong activity in the industrial sector. The publication serves as a hint toward Friday's all-important Nonfarm Payrolls report.
US ISM Manufacturing PMI April Preview: Let the good times roll
Ethereum, the second cryptocurrency in terms of capitalization, surged above the $3,000 mark early on Monday after gaining over the weekend. Reuters reported that the European Investment Bank could launch a sale of bods on the Ether blockchain. Reports that Andreessen Horowitz, a renowned venture capital firm is considering a $1 billion crypto fund have added to the broader digital asset space.
Ethereum price explodes to new all-time high of $3,000
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EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
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