The trade deficit certainly came in worse than expected. It was largely energy influenced but I don't think that should detract from the overall deterioration of the external balance. The dollar was already on the defensive this week and this data only reinforces that bias. |
The United States will still tout the strong-dollar policy. |
The vast majority of recent comments by ECB officials showed a true reluctance to intervene, |
The vast majority of recent comments by ECB officials showed a true reluctance to intervene. |
There are still some signs of tightness in the labor market. |
There has been some unwinding of the premium attached to the dollar, |
There has been some unwinding of the premium attached to the dollar. There are limits to how far the euro will rally, but the United States has more room to slow than Europe, which could take more wind out of the dollar's sails. |
There is speculation that the BOJ could raise rates as early as July, ... I'm not convinced, however, that this bout of yen strength is going to be maintained that much longer. |
There is speculation that the BOJ could raise rates as early as July. I'm not convinced, however, that this bout of yen strength is going to be maintained that much longer. |
There will be a lot of talk, but not a lot of position taking until the election results are known. |
There will be no change in rates in June, |
There's no reason to think that the latest political developments will correct those imbalances. |
This has resulted in an attractive real rate environment in the United States. |
Trading this week will be overshadowed by the Fed meeting. |
U.S. growth is outstripping expectations. |