Tag Archive: #USD

Market Pushes the Yen Lower, Helped by a Broadly Firmer Greenback

2024-05-07

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2024-05-07

Overview: The dollar is firmer against all the G10 currencies today. The market is somewhat less fearful of intervention and the yen is extending yesterday's losses. It is rivaling the Australian dollar for the weakest of the major currencies after the Reserve Bank of Australia left rates on hold and played down speculation of possibility of a rate hike. Both currencies are off around 0.4% in late European morning turnover. Disappointing German...

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Yen Slips, Yuan Jumps, Dollar is Mostly Softer

2024-05-06

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2024-05-06

Overview: The dollar is mostly a little softer today in thin market conditions, with Tokyo, Seoul, and London closed for holidays. The Japanese yen is the weakest G10 currency, losing about 0.5% and slipping through last Friday's lows. At first, after Fed Chair Powell did not endorse rate hike speculation, the market thought he was dovish. But after the softer than expected jobs data and weakness in the ISM services, the market shifted from...

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Dollar is Softer Ahead of the Employment Report

2024-05-03

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2024-05-03

Overview: The greenback is trading with a softer bias ahead of the US jobs report. Solid, even if not spectacular job growth, is expected. However, recent survey data warns of the downside risks. Moreover, counter-intuitively, the dollar has not often rallied this year into the employment data, but frequently has in response. The dollar is softer against the G10 currencies. The Norwegian krone is the strongest, up about 0.6% after the central bank...

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Japan Drives Home Message

2024-05-02

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2024-05-02

Overview: The US dollar is mixed, but the spotlight is on the Japanese yen. It appears that with the market challenging Monday's intervention, Japanese officials entered the market shortly after the US equity market closed yesterday, as the Asia Pacific session got underway and sold dollars again. Initial estimates suggest the intervention amount was two-thirds of Monday's. The timing caught the markets wrongfooted. Tokyo markets are closed Friday...

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May Day Fed Day

2024-05-01

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2024-05-01

Overview: Much of Asia and Europe are off for the May Day labor holiday. The dollar is mostly softer in the thin activity. However, the dollar has edged higher against the yen and approached JPY158. The euro initially fell to $1.0650, a six-day low and where a billion euros in options expire later today. It has recovered to almost $1.0675. Emerging market currencies are subdued. Central European currencies, the South African rand, and Mexican peso...

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Yen Retreats, while Stronger EMU GDP Underscores Nascent Recovery and Lifts the Euro

2024-04-30

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2024-04-30

Overview:  Stronger than expected eurozone GDP strengthened the sense that a nascent recovery may be taking hold and has given the euro a bid in the European morning. The dollar, though, is enjoying a firmer tone against the other G10 currencies today. Australia's unexpected weakness in retail sales has weighed on the Antipodean currencies. The Aussie and Kiwi are off slightly more than 0.5% today. Japanese data were mixed (a recovery in industrial...

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Yen Dumps before It Jumps

2024-04-29

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2024-04-29

Overview:  The FOMC meeting, the US employment report, and eurozone CPI were to be the highlights of the week, but the Japanese yen stole the march to start the week. The dollar soared to almost JPY160.20 before falling sharply to JPY154.55 and then rebounding to almost JPY156.00. Intervention has not been confirmed and BOJ data will not cover it until next month. On balance, it appears that most think it was algo-trading in thin markets given the...

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Dollar Consolidates but Adjustment is Not Over

2024-04-11

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2024-04-11

Overview:  Higher than expected US CPI for the third consecutive month drove US interest rates sharply higher and lifted the greenback broadly. The market appears to be catching its proverbial breath today, but the shallow consolidation suggests the moves are not over.

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US CPI, New Security Initiatives with Tokyo and Manila, Bank of Canada Meeting

2024-04-10

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2024-04-10

Overview: The dollar has been confined to narrow ranges ahead of the US CPI report. Given the backup of US rates and the stronger-than-expected jobs growth, the greenback's performance has been unimpressive.

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Dollar Consolidates Softer Ahead of Tomorrow’s CPI

2024-04-09

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2024-04-09

Overview: The dollar is trading with a softer bias in mostly narrow ranges against the G10 currencies. It did not rally much ahead of the US jobs data, and it was not able to sustain the upside momentum afterwards, despite the jump in US yields. Former St. Louis Fed President Bullard, who still has a strong reputation in the market, told Bloomberg TV yesterday that three cuts were his base case this year. The Scandis and Antipodeans are the...

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Will the Market Push the Dollar Above JPY152 as Japanese Prime Minister Heads to the US?

2024-04-08

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2024-04-08

Overview:  The jump in US rates after the employment report failed to ignite a sustained rally in the dollar and this shaken the market's near-term confidence. The dollar has been mostly confined to narrow ranges and the low yielding Swiss franc and Japanese yen are softest with the G10 complex today. The dollar is knocking on JPY152. The Scandis and Antipodeans lead the advancers. The euro has made little headway despite a much stronger than...

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US Employment Data to Set Dollar’s Course

2024-04-05

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2024-04-05

Overview: The focus is squarely on the US employment report. At the risk of oversimplifying, given the position adjustment in the past 48 hours, a solid report can see the greenback recover, while a disappointing report will likely see it deepen the correction of the rally that began with the February jobs report. The dollar recovered in the North American afternoon yesterday and many observers attributed it to the bevy of Fed comments. Yet, the...

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Greenback Losses Extended, but Look for Consolidation in North America

2024-04-04

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2024-04-04

Overview: The softer-than-expected ISM services report caught the market leaning the wrong way. Although interest rates had a muted reaction, the dollar was sold. In fact, the Dollar Index saw its second-biggest loss of the year, falling by about 0.50%. ISM services prices paid increases moderated to their slowest since March 2020. Supplier deliveries improved to their best since 2009, suggesting a supply chain improvement. Still, the Fed funds...

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Rate Adjustment Underpins Greenback

2024-04-03

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2024-04-03

Overview: The adjustment to US interest rates continues and this helps underpin the US dollar. The 10-year yield rose to 4.40% yesterday, the highest it has been since last November. It is trading 4.34%-4.38% today. The two-year yield is firm though holding below the Q1 high set last month near 4.75%. This week, for the first time since last October, the Fed funds futures do not have at least a quarter point cut discounted for July. As recently as...

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Gold, Oil, and Interest Rates Rise

2024-04-02

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2024-04-02

Overview:  The market put more weight on the rise in the US ISM manufacturing survey than the downward revision to the manufacturing PMI and the unexpected back-to-back decline in construction spending. US rates shot up and lifted the greenback. The Dollar Index made a new high for the year, a little above 105, which had been anticipated by the new lows recorded by the Bannockburn World Currency Index (a GDP-weighted basket of the currencies of...

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China PMI is Better than Expected but the Greenback Still Rises above CNY7.23

2024-04-01

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2024-04-01

Overview: The dollar is trading quietly against the G10 currencies as European markets remain on holiday. Narrow ranges have prevailed. The dollar-bloc currencies are leading with minor gains, perhaps helped on the margins by better-than-expected Chinese PMI, but the Scandis, which also typically do well amid a better global growth profile are the laggards. This may speak to the light liquidity conditions. Japan may have missed a tactical...

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Waller Pushes on Open Door: Push for Patience Lifts the Dollar, Complicating Japanese Efforts

2024-03-28

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2024-03-28

Overview: Comments by Fed Governor Waller, urging patience on rates and wanting more evidence that price pressures are moderating has helped the greenback extend its recent gains. The yen is the notable exception as the fear of intervention has restrained the dollar bulls. Poor German data, including a sharp 1.9% drop in February retail sales, the fourth consecutive monthly decline, underscored the euro's negative divergence, and the single...

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Heightened Threat of Japanese Intervention Pushes Greenback Away from JPY152

2024-03-27

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2024-03-27

Overview: The dollar neared JPY152, setting a new 34-year high. This appeared to spur a senior official meeting in Tokyo, ostensibly to talk about the response. Previously, we suggested that Friday, when most markets outside of Asia will be closed, could provide an interesting opportunity for intervention. The implicit threat was enough to take the dollar to JPY151.10 in the European morning. Most of the G10 currencies are softer against the dollar...

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Dollar’s Recent Gains Pared but Firm Undertone Remains Intact

2024-03-26

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2024-03-26

Overview: After surging at the last week, the dollar consolidated yesterday and is continuing to do so today as slightly lower levels. The Swiss franc is the only G10 currency unable to gain traction against the greenback today. Still, the dollar's pullback has barely met the minimum retracement targets of the jump last Thursday and Friday. The PBOC lower the dollar's fix slightly, but the proverbial toothpaste is out of the tube and officials are...

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Greenback Consolidates Last Week’s Surge

2024-03-25

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2024-03-25

Overview: After surging at the end of last week, the dollar is consolidating today. Stepped up verbal intervention by Japan's currency chief Kanda and a slightly weaker dollar fix by the PBOC seemed to take the wind from the dollar sails. Except for the Swiss franc and Swedish krona, the G10 currencies are showing a slightly firmer tone. Emerging market currencies are mixed, with central European currencies leading the advancers. The Taiwanese...

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