Daily Market Update
March 26, 2024The EUR/USD ranged in the mid 1.08’s overnight. Global growth will likely slow this year, but a dovish tilt in the Federal Reserve’s stance has raised hopes for the U.S. economy and brightened the outlook for riskier assets, according to big banks.The latest U.S. inflation data showed that in the 12 months through February, U.S. consumer prices edged 3.2% higher after increasing 3.1% in January.
Later on Tuesday, U.S. manufacturing, services and consumer confidence figures are due. U.S. core PCE data is due on Friday. The euro was last up 0.18% at $1.0858 and the pound rose 0.17% to $1.2658, both in the middle of their recent ranges, and walking back some of their losses from last week. In the spotlight was the yen , which has been trading close to its weakest against the dollar since 1990, even after the Bank of Japan raised interest rates last week for the first time in 17 years. The 14% decline in the yen’s value over the last 12 months fed a surge in Tokyo’s Nikkei index, opens new tab to record highs this month, but stirred concern among Japanese officials that the recent depreciation is problematic. Away from Asia, currency volatility was low, and traders have found few catalysts on which to trade in recent weeks. This week’s economic data calendar is fairly light ahead of the Federal Reserve’s favored inflation measure on Friday, which could provide clues on the U.S. interest rate outlook. The U.S. core personal consumption expenditures (PCE) index is seen rising 0.3% in February, which would keep the annual pace at 2.8%. The Swiss franc, one of the few European currencies which lack a clear direction since the Swiss National bank surprised markets by cutting interest rates last week, kept trending lower. The dollar was up 0.28% at 0.9022 francs, a four month high, while the euro was up 0.5% at 0.9797 francs, its highest since July 2023. China’s yuan, which has also been on traders’ radars especially since its sudden plunge on Friday, was last a little weaker at 7.219 per dollar in the onshore market, despite a firmer-than-expected central bank fixing. The offshore yuan was a touch stronger at 7.245 per dollar. That helped China-exposed currencies to firm, with the New Zealand dollar rebounding from a four-month low to $0.6021 and the Aussie up 0.2% at $0.6553. Source: Reuters |