We would need a very bad trade number to hurt the dollar against the euro, given positive dollar sentiment at the moment.
People are unwinding short yen positions ahead of the BOJ meeting. Some market participants are speculating on what kind of the language and economic assessment would come out of the meeting.
After we failed to break the year's lows against the euro, people decided to take some money off the table. Hedge funds are among those selling the dollar, and they're causing this sharp move upward.
The move in the yen has spilled over on the perception the dollar will continue to gain as the Fed keeps raising rates.
The Fed is close to the end of its rate hike cycle while the ECB is just beginning, which removes support for the dollar.
We don't expect another rate cut ..., but there is still the risk that rates might be cut again at some point if the economy should slow further.
There was an upgrade in the economic assessment by the BOJ and comments from governor Fukui. From that point of view an end to the zero interest rate policy is coming closer.
A coalition of this kind would hurt the reform process considerably, and that's worrying the market. I'd expect to see further euro weakness ahead of the election.
It's likely to be another difficult year for the rand. As the yield gap narrows, that will make it more difficult for South Africa to attract the investment it needs.
Copyright © 2024 Electric Goat Media. All Rights Reserved.