The dollar is up as investors take profits after China manufacturing data disappoints and US income data soars
After gaining 5% in April, the S&P 500 looks set for profit taking as investors close out the month. The dollar, which has been selling off during this risk-on month, has rallied overnight. Investors have plowed money into risk assets and sold the dollar this month on expectations of a strong global economic recovery. Overnight Chinese PMI data for April came in weaker than expected and investors sold equities and bought dollars. Personal income growth hits an all-time high in the US.
“You have to see failure as the beginning and the middle, but never entertain it as an end”
April 30, 2021
EUR/USD 1.2085 GBP/USD 1.3884 USD/CAD 1.2273 AUD/USD 0.7763 USD/JPY 108.95 USD/CNH 6.4660 USD/ILS 3.2442 USD/MXN 20.0723 USD/CHF 0.9099 USD/INR 74.0788 USD/BRL 5.3804 USD/SGD 1.3277 USD/DKK 6.1534 USD/SEK 8.4078 USD/NOK 8.2453
The dollar is stronger after a week of losses after Chinese manufacturing data missed estimates. Personal Income grew 21% in March as stimulus checks hit individuals' bank accounts. Inflation data came in as expected with the March PCE Core Deflator at 1.8% YoY.
The University of Michigan Consumer Sentiment index for April will be released later this morning.GBP
The pound sank on overall dollar strength. It seems the pound has dipped as investors prepare for next week’s Bank of England meeting. Market participants are divided over whether policy makers will taper bond purchases or wait until later.EUR
The euro lost ground on overall dollar strength. A Q1 GDP reading for Germany, Italy and Spain showed economic contraction highlighting the persistent effects of Covid lockdowns. By contrast, the US grew by 6.4% in the same period and China grew 18%. Granted these figures are skewed due to prior year pandemic shutdowns.CAD
The Canadian dollar strengthened despite lower than expected Chinese manufacturing data which led to a broad sell-off in equities and other risk assets at month end.ASIA/PACIFIC
Chinese manufacturing PMI slipped to 51.5 missing consensus whilst the non-manufacturing gauge also dropped to 54.9. A reading above 50 represents growth.
The Japanese yen strengthened on safe haven buying. Japanese markets will be closed Monday through Wednesday next week for the Golden Week holiday.
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