U.S. Dollar a little mixed as well as markets

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U.S. Dollar a little mixed as well as markets

SEPTEMBER 07, 2021

The U.S. Dollar is trading in familiar ranges to last week when the buck was rallied against as data describing the labor situation in the U.S. showed us steam is cooling off when it comes to businesses hiring. 

Overview

The readings on Friday inspired a lot of writing about where the Fed will need to go next after it seemed convinced in the Jackson Hole Symposium that it would start looking at tapering quantitative easing as soon as this month’s meeting on September 22nd.

Much of this month will also have a fiscal focus as President Joe Biden looks to get his infrastructure spending bill implemented by Congress. For this week, the world’s largest economy will likely find out if the President re-nominates Jerome Powell to continue steering the monetary ship in these highly unpredictable times.

We shall see if this week is good one for risk-appetite following news that Chinese exports and imports both climbed at a faster pace than forecast, thus easing concerns after terrible Factory Orders and Purchasing Managers Index figures for the month prior.

What to Watch Today…

  • No major economic events scheduled for today

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EUR  

The Euro is starting the week with speculation on growing on its side as traders weigh the chances that the European Central Bank will start looking into shedding away some of its emergency purchases aimed at easing financial stress. The pandemic surely forced the heavy hand of the ECB to sustain the economy while there have been lockdowns throughout the medical crisis.

As inflationary growth remains a threat to economic growth in the eyes of some officials, expect more statements this month signaling that many are ready to see the volume come down. If indicators suggest otherwise that the economy requires inflation to be ignored, ECB leader Christine Lagarde may defend the current dovish stance.

GBP 

The Pound declined a bit in comparison to where it was before the holiday weekend as data from the British Retail Consortium seemed to indicate there was a big slowdown in spending in August. Year-over-Year Sales went down from 6.4% to 3.0% in July, thus concerning economists that the official Retail Sales figures will be quite low. Expect high volatility in what should be a very active and busy month for central banks and government spending in all regions.

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