The US dollar is trading mostly higher with the greenback moving modestly higher verse the AUD(+0.13%) and NZD (+0.09%). The dollar is up the most versus the JPY (+0.60%). The EURUSD and the GBPUSD are within 0.12% of the closing level from yesterday.
The dollar is only lower vs the CAD (-0.12%). Yesterday, the USDCAD was whipped around with the tariff news. Today, the price action has been up and down as well, just in a more narrow range. The 200 hour MA is being tested on the downside as the day begins. Buckle up.
USDCAD technicals
The video above outlines the key levels in play for the 3 major currencies – the EURUSD, USDJPY and GBPUSD.
On the tariff front, President Trump’s steel and aluminum tariffs have gone into effect at 25% across-the-board. Canada has announced that it will enact $29.8 billion in retaliatory tariffs on the US.
Secretary of State Marco Rubio says that he will contact Russia on Wednesday. Says Russia’s reaction to the cease-fire plan is known. Overnight Russia did say that a cease-fire will be on their terms and not the US terms.
A review of central banker comments overnight:
BoJ Governor Kazuo Ueda noted that long-term rates have been rising since last year, reflecting market views on economic conditions, price developments, and overseas rate changes. He emphasized that there is no major divergence between the central bank’s outlook and market expectations but warned about uncertainties in the global economy and prices.
ECB President Christine Lagarde emphasized the need to set monetary policy to ensure inflation converges toward the 2% target, acknowledging that it cannot always remain precisely at that level. She warned that large economic shocks could make inflation more persistent and noted that trade fragmentation may cause more significant and disruptive relative price changes. While she refrained from providing forward guidance, she stressed the importance of maintaining clarity on the central bank’s reaction function.
ECB policymaker Gediminas Šimkus stated that the central bank will decide in April whether to cut rates or pause, emphasizing that it is irrational to commit to future rate decisions. He noted that the overall policy direction remains unchanged.
Today the US CPI data will be released at 8:30 AM ET with the headline and core month-to-month readings expected to rise by 0.3%. The YoY expectation for the headline is for 2.9% versus 3.0% last month. The Core YoY is expected 3.2% versus 3.3% last month
Treasury yields are moving higher with the yield curve flattening a bit. The US treasury will auction off 10-year notes at 1 PM ET today. The 3-year note auction saw strong domestic buying yesterday. A snapshot market currently shows:
- 2-year at 3.976%, +3.5 basis points
- 5-year at 4.064%, +2.3 basis points
- 10-year at 4.302%, +1.5 basis points
- 30-year at 4.607%, +0.4 basis points
US stocks are higher after a volatile up-and-down session yesterday with the major indices all closing lower. Goldman Sachs reduced its end-of-year target for the S&P to 6200 vs 6500. The S&P closed at 5572 yesterday. The futures are currently implying
- Dow up 220 points. Yesterday the index fell -470 823 points or -1.14%
- S&P up 40.68 points. Yesterday the index fell -42.49 points or -0.76%
- Nasdaq up 220 points. Yesterday the index fell -32.23 points or -0.18%
European stock indices are trading mostly higher with German DAX surging by 1.8%, Spain’s Ibex is trading lower:
- German DAX, +1.75%
- France’s CAC, +1.38%
- UK’s FTSE 100 +0.65%
- Spain’s Ibex -0.22%
- Italy’s FTSE MIB +1.54%
In other markets:
- Crude oil is trading up $0.75 or 1.3% at $66.98
The EIA data weekly inverntory data will be released today. The private data was released late yesterday and showed:
- Crude: +4.2M (exp. +2.0001M)
- Distillate: +0.4M (exp. -0.757M)
- Gasoline: -4.6M (exp. -1.882M)
- Cushing: -1.2M
- Gold is down $-2.90 or -0.10% at $2912.72
- Silver is up $0.11 or 0.35% at $33.02
- Biitcoin is little changed and $82,906
