The dollar is proving that its post-Fed slump was merely a blip, as it runs higher now on the week. The greenback has erased its declines after the FOMC meeting and then some now, posing some key technical questions here. That will be an important detail to pay attention to as we look to wrap things up on the week.
In other markets, equities are fairly cautious after a late retreat yesterday in Wall Street. Major indices still closed at record highs, so you can’t really complain about that now can you? Meanwhile, Treasury yields are still on the retreat slightly but squares up against the key technical juncture here.
The SNB surprise yesterday is certainly posing some considerations that other major central banks might also look to cut rates sooner than expected. But I’d argue that the chances of that happening are less so, at least for the first move. The Fed and ECB are poised for a move in June and that hasn’t changed since the developments this week.
Looking to the session ahead, we’ll have a couple of decent data releases to work through. The UK retail sales will be in focus again, with the monthly estimates set to show a slight decline. UK consumption remains soft as high prices continue to weigh. And that remains evident from this post a few months back here.
We’ll also have the German Ifo business survey but that should just reaffirm more sluggish conditions for now. The hope for Germany is that sentiment will start to turn once we get to the ECB rate cuts later this year.
0700 GMT – Germany January import prices
0700 GMT – UK February retail sales
0900 GMT – Germany March Ifo business climate index
1100 GMT – UK March CBI trends total orders
I wish you all the best of days to come and good luck with your trading! Stay safe out there.