With the Dow hitting a new high, all eyes are on the direction of the U.S. dollar
16.04.2021
- University of Michigan Consumer Sentiment Index
- The Dow Jones Industrial Average Hits a New High
Yesterday, the Dow Jones Industrial Average hit a record high, leading to a “risk-on” market characterized by rising stock prices, a weaker dollar, and lower interest rates. Crude oil rose to 63.6 for the first time in about a month, while gold also rose in inverse proportion to the U.S. dollar and is currently trading around $1,764.The market reacted positively to yesterday’s release of the U.S. April Philadelphia Fed Manufacturing Index, which came in at 50.2—its highest level in 48 years.
In the foreign exchange market, cross-yen pairs are divided into those trending upward and those trending downward. The euro/yen and U.S. dollar/yen pairs are holding steady, while the pound/yen pair is consolidating after hitting a lower high. Since the euro/pound pair is rising and the pound/U.S. dollar pair is falling, it’s prudent to remain vigilant for a potential decline in the pound/yen pair.
Today’s schedule includes the Eurozone Consumer Price Index and trade balance at 6:00 p.m., remarks by BOE Deputy Governors Kanrif and Woods at 6:00 p.m., the Turkish Housing Price Index at 8:30 p.m., and the Canadianhousing starts, at 9:15 PM: U.S. housing starts and building permits, at 9:30 PM: U.S. housing starts and building permits, at 11:00 PM: U.S. University of Michigan Consumer Sentiment Index, and at 11:45 PM: remarks by Kaplan, President of the Federal Reserve Bank of Dallas.We will be closely monitoring how the recent rise in stock prices and decline in interest rates will affect the foreign exchange market.
Author: Keisuke Sakurai
