The outlook for the Fed policy is clearly data dependent. I cannot see much downward correction to the U.S. dollar over the near term being driven by the data.
The price action of the last few days does suggest a potential exhaustion in the dollar's rally,
The price action of the last few days does suggest a potential exhaustion in the dollar's rally.
The Reserve Bank may shift to a very mild tightening bias which won't be enough to support the Australian dollar while the Fed is pushing up rates.
There are clearly upside risks around the consensus expectations for non-farm payrolls. As such, we would not be short the U.S. dollar over the next 24 hours.
There is typically a bounce in such purchases and if this proves subdued this year, many investors will conclude that a stronger Japanese economy and rising bond yields has moderated Japanese investor appetite for foreign assets. This scenario would see the yen a lot firmer.
Today's BOJ meeting is a momentous event. The end of quantitative easing is near. The market doesn't necessarily believe it will happen today, but if it doesn't happen today it will be April.
U.S. economic reports serve to remind investors that U.S. economic growth remains solid, and as long as this continues, writing the U.S. dollar off could prove a costly strategy.
We're back to 5 percent expectations and the dollar is recovering from its sharp slide of last week. The dollar has a little further to go.
While a hawkish sounding ECB will protect the downside for the euro in the short term -- support looks solid back to 1.2050 -- the fragile euro-zone economy argues against any interest rate increases for sometime to come,
While a hawkish sounding ECB will protect the downside for the euro in the short term -- support looks solid back to 1.2050 -- the fragile euro-zone economy argues against any interest rate increases for sometime to come.
While commodity prices have been rising Australia's interest rate spread has been narrowing.
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