Will the U.S. dollar regain strength as expectations of a U.S. rate cut fade? Stay tuned.
04.01.2024
- Germany's Consumer Price Index
- UK Manufacturing/Services PMI
In the U.S. currency market the previous day, the minutes of the FOMC meeting released yesterday indicated that the policy interest rate was nearing the peak of the tightening cycle, while also stating the intention that “a restrictive stance is appropriate for the time being until a sustained slowdown in inflation becomes clear.”This served to rein in financial markets’ excessive expectations of interest rate cuts. As a result, the euro fell against the U.S. dollar from 1.0964 to 1.0892, marking its fourth consecutive day of decline.
European currencies rose against the euro following the release of Germany’s December employment statistics yesterday, which showed that the unemployment rate remained unchanged from the previous month at 5.9% and the number of unemployed fell from 22,000 to 5,000.The EUR/AUD pair rose from 1.6153 to 1.6274, rebounding from the 20-period moving average (MA) on the 4-hour chart. Since the 75-period MA is acting as a support level on the weekly chart, it will be worth watching whether the rebound continues in terms of trading days.
Today, at 16:45, France’s Consumer Price Index; at 17:30, Hong Kong’s Retail Sales; at 17:50, France’s Manufacturing/Services PMI; at 17:55, Germany’sManufacturing/Services PMI, at 6:00 PM the Eurozone Manufacturing/Services PMI, at 6:30 PM UK Consumer Credit Balances, UK Money Supply, and UK Manufacturing/Services PMI, at 9:30 PM U.S. Challenger Layoffs, at 10:00 PM GermanConsumer Price Index, at 22:15: U.S. ADP Employment Report, at 22:30: U.S. Initial Jobless Claims, at 23:45: U.S. PMI Purchasing Managers’ Index, and at 25:00: U.S. Weekly Crude Oil Inventories.We will need to carefully assess whether the U.S. dollar will regain strength as expectations of a U.S. interest rate cut fade.
Author: Keisuke Sakurai
