Dollar Gains Modestly; Krona Free Falls

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After slipping yesterday while U.S. banks were celebrating President’s Day, the greenback is making modest strides this morning as the mood surrounding trade is more optimistic.

Overview

Chinese Vice Premier will meet with U.S. Trade Representative Lighthizer and Treasury Secretary Mnuchin later this week ahead of the March 1 deadline for the initiation of more tariffs.

There is no major economic data slated for release today.  The Federal Reserve will release the minutes from their last monetary policy meeting on Wednesday afternoon.  This was the meeting the central bank took a more dovish tone towards future policy with some claiming the Fed cowered to political pressure.  As always, we will be looking for clues to the Fed’s thinking on future policy.  Fed Futures show a 15% chance the Fed finds the scope to cut interest rates by the end of the year.

 

What to Watch Today…

  • No major events scheduled for today.

The complete economic calendar can be found here.

 

SEK

The Swedish krona was the biggest loser overnight after Swedish inflation unexpectedly slowed last month. The krona is experiencing its biggest daily fall versus the Euro since November 2017.  The slowing inflationary pressure adds to speculation that the central bank may not be able to end its four years of negative interest rates as it had planned for this year.

GBP

The British pound popped higher in early trading following the release of decent data but has since given back some of its gains.   A report showed U.K. wages grew at their fastest pace in a decade and unemployment fell 14K.  The jobless rate remains at 4% which is the best since 1975.

Brexit uncertainty continues to block the sterling’s path higher. Over the weekend, seven Labour party MPs left the party to create their own party over Brexit.  The March 29 deadline is rapidly approaching as negotiators struggle to strike an agreement.  European Commission President Jean-Claude Juncker quipped that “we are in God’s hands.”

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