Risk-on sentiment hit the dollar as new virus cases in Europe seem to be slowing leading to speculation economic activity has bottomed
Currency markets begin to price in a return of some economic activity even as economic data this week will show the worst hit to the US economy since the Great Depression.
Economic Data for this Week:
Monday: Dallas Fed Mfg Activity for April
Tuesday: Consumer Confidence for April, Richmond Fed Mfg Index for April
Wednesday: Q1 GDP (survey -3.9%), FOMC rate decision, Mortgage applications and Home sales for April
Thursday: Initial Jobless Claims (survey -3.5 million), Personal Spending and Core PCE for March
Friday: Markit Mfg PMI and ISM for April, Construction spending for March
April 27, 2020
EUR/USD 1.0853 GBP/USD 1.2431 USD/CAD 1.4060 AUD/USD 0.6467 USD/JPY 107.0100 USD/CNH 7.0889 USD/ILS 3.5078 USD/MXN 24.8130 USD/CHF 0.9741 USD/INR 76.2425
The US dollar lost ground to start the week as financial markets became optimistic as new coronavirus cases slowed in many European countries.
The FOMC meets later this week for a regularly scheduled meeting. During the press conference that follows, investors will look for clues of additional measures to be launched by the Fed in support of the economy.GBP
The British pound is stronger as Prime Minister Boris Johnson returns to work after being hospitalized with COVID. The FTSE 100 jumped almost 2% as investors speculate the UK economy will begin to reopen.EUR
The euro was only able to gain slightly vs the US dollar despite positive sentiment in equity markets on the easing of the lockdown in some countries. The ECB meets Thursday but financial markets are not expecting anything new.CAD
The Canadian dollar strengthened but remains above the 1.40 level. The price of oil remains weak and market experts expect oversupply to begin forcing the closure of crude production by mid-May.ASIA/PACIFIC
Japan's emergency measures have been expanded to the national level and more stimulus has been announced by the Bank of Japan. The yen strengthened on the news.
Asian currencies all strengthened some relative to the US dollar on overall dollar weakness. However, the Indian rupee remains at close to its all-time weakest levels relative to the dollar.
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