AutoDollar Gives Back Overnight Gains; Stocks Set to Open Lower Draft

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Dollar Gives Back Overnight Gains; Stocks Set to Open Lower

AUGUST 12, 2019

The U.S. dollar was mixed overnight, falling against the Japanese yen but gaining against most of its G10 counterparts.

Overview

However, the dollar has given back much of its overnight gains in early trading.

The economic docket is light today but the rest of the week is chalked-full of potential dollar-moving events.  The consumer price index will cross the wire tomorrow giving a glimpse at consumer inflation following a dip in producer prices on Friday.  Retail sales on Thursday will be telling as consumer purchase account for nearly 70% of the economy.  Industrial production will also be out on Thursday and housing starts, building permits and the University of Michigan consumer sentiment will round out the week on Friday.

In the meantime, we will keep a close eye on the price of oil, political developments in Italy and Hong Kong and President Trump’s Twitter account.

What to Watch Today…

  • No major events scheduled for today.

Complete Economic Calendar can be found here.

EUR

The Euro opened the trading week by falling significantly versus the U.S. dollar overnight as political concerns in Italy came to ahead.  Deputy Premier Matteo Salvini and his party have been working to bring a no-confidence vote against Premier Giuseppe Conte.  On the relative plus side, Italy did avoid a downgrade from Fitch Ratings.  But the rating’s agency did hold hits negative outlook for the third-largest economy in Europe.

However, EUR/USD has regained most of its losses as the American trading session beings.

JPY

The safe-haven Japanese yen rallied again overnight as the trade conflict between the U.S. and China seems farther apart than ever.  President Trump said trade talks with China may not take place in September as previously planned.  For their part, China set its yuan reference rate weaker than 7 for the third time.  Protestors shut down the Hong Kong airport, further souring the mood.

Equity futures are awash with red this morning further boosting the yen as a safe-haven. The yen is at a six-month high against the greenback.

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