Stocks & dollar lower ahead of inflation and retail sales data
Traders are starting the week cautiously with a full week of economic data, big bank Q1 earnings releases, and a round of big Treasury auctions. The dollar is slightly lower, the UK pound and Japanese yen showing the biggest gains. The United Kingdom is opening up pubs, restaurants and non-essential shops amid the lowest Covid cases since September. US Treasury 10Yr yields are up 3 bps to 1.67%, gold is lower by $8 to $1735 per oz, and oil up $1 to $60.40 per barrel.
Economic Data & Events
Monday: Eurozone Retails Sales (Feb)
Tuesday: CPI (Mar), Small Business Optimism Index (Mar), Eurozone ZEW Survey Expectations (Apr)
Wednesday: Export & Import Prices (Mar), Fed’s Beige Book
Thursday: NAHB/Wells Fargo Housing Market Index (Apr), Retail Sales (Mar)
Friday: Univ of Mich Consumer Sentiment Index (Apr), Eurozone CPI (Mar)
April 12, 2021
EUR/USD 1.1908 GBP/USD 1.3742 USD/CAD 1.2556 AUD/USD 0.762 USD/JPY 109.42 USD/CNH 6.5517 USD/ILS 3.2916 USD/MXN 20.1084 USD/CHF 0.9238 USD/INR 75.0550 USD/BRL 5.6446 USD/SGD 1.3412 USD/DKK 6.2464 USD/SEK 8.5693 USD/NOK 8.4821
The dollar is slightly lower, erasing earlier gains, ahead of a slew this week of economic data, bank earnings and Treasury funding. March’s CPI MoM is expected to be 0.5%, up from 0.4%, and Retails Sales MoM are expected to rise 5%, up from -2.7%. During the week, the big US banks – BoA, Citigroup, Goldman, JPMorgan, Wells – report fiscal Q1 2021 earnings. The US Treasury sells 3-, 10- and 30-year bonds.GBP
The UK pound gained nearly 0.4% since Friday’s close, outperforming all other G-10 currencies. The UK government announced that outdoor pubs and restaurants, shops, gyms will reopen today. A quick rebound of the economy is expected as consumers have accumulated £150 billion in savings during the pandemic. The UK also releases key economic stats this week, including Industrial Production, Trade Balance, and monthly GDP.EUR
The euro gained off earlier lows on the back of higher-than-expected Retail Sales -- a rise of 3% for February compared favorably with expectations of 1.7% and January’s decline of 5.9%. News in Germany is that a decision is forthcoming on the successor to Angela Merkel as chancellor.CAD
The Canadian dollar edged lower ahead of today’s Bank of Canada business outlook report. Upbeat expectations could add support to the view that the BoC may be preparing to taper asset purchases, which some economists believe will have a negative impact on Canada’s economy.ASIA/PACIFIC
The Indian rupee fell by nearly 0.5% over the weekend, as Covid-19 infections reached new highs. However, companies in India are against more lockdowns and instead are working with the government to vaccinate their employees.
The Japanese yen edged higher in a slight risk-off mood after regional stock markets declined. Or from enthusiasm following golfer Hideki Matsuyama winning The Masters, the first Japanese or Asian player to ever win a men’s major golf tourney.
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