Dollar Starts Quarter on the Front Foot

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Dollar Starts Quarter on the Front Foot

APRIL 01, 2021

April Fools’ Day and Baseball’s Opening Day!  The dollar starts the new quarter exactly where it left off in Q1, on the front foot. 

Overview

The Dollar Index gained 0.2% after having its best quarter in a year.

Overall, currency movements have been muted and will likely continue the rest of the week as much of the world begins to shut down for the Easter Holiday.  However, there is plenty of economic data due out later today that could shake markets. Weekly jobless claims rose 61K to 719K last week, which remains historically bad.  Later, U.S. manufacturing PMI and ISM manufacturing are due out. Construction spending for February will hit the wire at the same time.

Markets in Mexico are closed today and tomorrow.  Much of Europe and Commonwealth countries will be closed both Friday and Monday.  While U.S. equity markets will be closed on Friday, currency markets will be open.

With thin liquidity conditions likely, Friday’s Non-Farm payrolls print could cause major volatility. Economists expect that the U.S. economy added a whopping 650K jobs in March as the economy reopens.  That would be up from a decent 379K in February.


What to Watch Today…

  • Markit and ISM Manufacturing

View Economic Calendar

EUR  

The Euro was mostly unchanged against the U.S. dollar as volume decreases ahead of the Easter holiday. Markets in the Eurozone will be closed tomorrow and Monday.  Fresh concerns about new lockdowns have weighed heavily on the common currency.  Yesterday, French President Emmanuel Macron announced a nationwide four-week lockdown, closing schools and businesses.  While Germany has avoided a new lockdown, the threat remains.

CAD  

The Canadian dollar is under a bit of pressure this morning as the market awaits news from the latest OPEC+ meeting on oil output.  There is also some domestic data worth watching with February building permits and Markit Canadian manufacturing due out later this morning.

Nevertheless, the loonie remains elevated after it gained 2% against its American rival in the first quarter of the year.

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