ASIDE from a modest loss against the yen, the US dollar rose against its major trading partners early yesterday, ahead of the release of various data reports, including home prices, new-home sales, and consumer sentiment.
The week’s data schedule stays busy through the end of the week, with significant releases including advance trade and pending home sales today, the advance Q1 GDP figure on Thursday, and personal income and spending on Friday.
Officials from the Federal Reserve are keeping a low profile ahead of the Federal Open Market Committee meeting on May 3-4, when markets predict a 50-basis-point rate hike based on recent statements from officials.
The EUR-USD slipped to 1.0694 from 1.0712 at Monday’s US close and 1.0726 the day before, according to a short review of foreign exchange activities heading into yesterday. While yesterday, there was no EU on the data schedule.
The European Central Bank is following the Fed’s tightening course, while some ECB officials have hinted at a rate hike in July, and ECB President Christine Lagarde has said that asset purchases will be phased out early in the second half of the year.
Also on Friday, the European Union’s inflation data will be announced.
The GBP/USD exchange rate decreased to 1.2715 from 1.2741 at the US closing on Monday and 1.2712 the day before. There was no UK data yesterday though markets anticipate another rate hike at the Bank of England’s next meeting on May 5, possibly by 50 basis points.
The USD-JPY fell to 127.6506 from 128.1329 at the US close on Monday and 128.1558 the day before. According to figures released overnight, the jobless rate in Japan fell to its lowest level since the beginning of the epidemic in March.
The USD-CAD exchange rate climbed to 1.2744 from 1.2736 at the US close on Monday, but was still down from 1.2761 the day before. However, manufacturing sales data for Canada was announced yesterday .
On June 1, the Bank of Canada will meet again, with another 50-basis-point rate hike likely. Some economists are factoring in the likelihood of a 75-basis-point boost if inflation data warrants it.
