Dollar Soars on Fed Powell’s Renomination
By Kathy Lien, The U.S. dollar soared against all of the major currencies after President Biden officially renominated Jerome Powell as Federal Reserve Chairman. Dr. Lael Brainard, the only other realistic candidate will become Vice Chairman when Richard Clarida’s term ends in January. When it comes to central bankers investors generally prefer continuity…
Dollar shines, euro suffers as COVID fears flare over Europe
By Kevin Buckland TOKYO (Reuters) – The safe-haven U.S. dollar traded close to a 16-month high to the euro on Monday on growing anxiety over the impact of surging COVID-19 infections in Europe, with Austria reimposing a full lockdown and Germany considering following suit. The greenback was near its strongest since early October…
Dollar Dominance on Strong Retail Sales – More Gains Ahead?
By Kathy Lien, Investors bought U.S. dollars after retail sales rose for the third month in a row. The increase in demand was widely anticipated but the increase in overall spending along with spending ex autos beat expectations. This means that while higher prices certainly played a role in the gains, consumers were…
Week Ahead
In the US, retail sales and industrial production numbers for October are seen pointing to an increase in domestic trade and a rebound in factory activity. In addition, housing data are likely to show a pick-up in housing starts and building permits, which fell in September to multi-month lows due to high costs…
Hot U.S. inflation drives dollar to 2021 peaks
By Tom Westbrook SYDNEY (Reuters) – The dollar stood at its highest levels of the year against sterling and the euro on Thursday, while the yen was smarting from its sharpest drubbing in a month, after the hottest U.S. inflation reading in a generation fanned bets on rate hikes. The euro was pummelled…
Currencies Tumble As Inflation Worries Grow
By Kathy Lien Risk appetite soured today as the Dow Jones Industrial Average closed lower for the first time in nine trading days. The simultaneous decline in currencies and Treasury yields confirms our view that investors are growing concerned about high inflation. USD/JPY dropped to its lowest level in nearly a month. This…
Dollar firms as U.S. inflation poses next test
By Tom Westbrook SYDNEY (Reuters) – The dollar made a steady start to the week in Asia on Monday but stayed below Friday peaks, as currency traders seek a path between markets’ volatile rate projections and central bankers vowing a wait-and-see approach despite surging inflation. The next big test of faith in the…
Dollar in driver’s seat as payrolls loom; sterling battered
By Kevin Buckland TOKYO (Reuters) – The dollar was on course for a second straight week of gains against major peers on Friday, ahead of a key U.S. jobs report that could sway the timing of Federal Reserve interest rate increases. Sterling headed for its worst week in 11 after the Bank of…
USD Dips (Slightly) on Fed Taper, Could BoE Hike Rates?
By Kathy Lien The Federal Reserve has made it official. Starting later this month, they will reduce their monthly bond purchases by $15 billion ($10 billion Treasuries, $5 billion mortgage backed securities). By June 2022, the bond buying program should come to an end. The Fed explains that pandemic stimulus can start to…
USD Outlook – $15B Taper is Magic Number for FOMC
By Kathy Lien, For the first time since the pandemic began, the Federal Reserve will reduce the stimulus they provided during COVID-19 crisis. Given the significance of this move and what it means for the central bank’s economic outlook, the U.S. dollar should be trading much higher. However, there’s been very little demand…
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