The US dollar is slightly stronger driven by the 10-year Treasury yield pushing over 2.75%. The Japanese yen added to its losses as investors do not expect the Bank of Japan to deviate from its highly accommodative monetary policy. The Chinese renminbi lost ground to the US dollar as the 10-year Treasury yield surpassed its Chinese equivalent government bond for the first time since 2010.
Economic Data this Week:
Tuesday: CPI for March (YoY +8.4% forecast)
Wednesday: PPI for March (YoY +10.6% forecast)
Thursday: March Retail Sales (MoM +0.6% forecast), Initial Jobless Claims, Univ. of Michigan Consumer Sentiment, European Central Bank meeting.
Friday: Industrial Production for March, Empire Manufacturing for April
April 11, 2022
EUR/USD 1.09 GBP/USD 1.3031 USD/CAD 1.2603 AUD/USD 0.7440 USD/JPY 125.75 USD/CNH 6.3673 USD/ILS 3.2159 USD/MXN 20.0571 USD/CHF 0.9340 USD/INR 75.955 USD/BRL 4.7251 USD/SGD 1.3646 USD/DKK 6.8241 USD/SEK 9.4557 USD/NOK 8.7578
USDThe dollar posts early gains to start the week as investors prepare for a busy week of economic data. With another high inflation reading expected tomorrow, the financial markets are pushing US Treasury rates higher which is in turn supporting the dollar. Corporate earnings for Q1 will continue to pour in this week with investors watching for how companies perform in a higher inflationary environment.GBPThe British pound bounced along 1-year lows versus the US dollar. UK Industrial Production figures for February disappointed as did GDP data.EURThe euro strengthened as Macron led the first round of the presidential election. Financial markets see a continuation Macron's presidency as a more stable path compared to a victory by the right-wing Marie Le Pen who once favored France quitting the euro. The second round of the election will be in two weeks.CAD
The Canadian dollar slipped as the price of oil dropped 3%. Since the March 24 high of $115/bbl, the price of oil has fallen 18%.ASIA/PACIFIC
The Japanese yen added to losses which have seen the yen weaken by over 9% since March 4. Yields on US Treasuries continue to move higher drawing in Japanese investors who sell the yen to buy dollars.
China may cut its benchmark interest rate this week to support the economy as COVID-related lockdowns suppress economic activity. The renminbi gave up some ground overnight as March inflation data in China came in higher than expected.
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