Dollar Remains Flat Anticipating Next Week’s Inflation Data

The US dollar traded flat against other major currencies, following comments from several members of the Federal Reserve in anticipation of next week’s key inflation report. Meanwhile, the Australian dollar strengthened due to a dovish outlook for the Reserve Bank of Australia, while the New Zealand dollar strengthened. A move to a range of 5.00% to 5.25% in the federal funds rate “seems to be a very reasonable view of what we must do this year to reduce the imbalance between supply and demand”, according to the president of the Nova. York Federal Reserve. John Williams. Williams’ comments came after President Jerome Powell’s interest rate outlook on Tuesday, when he reiterated that the process of “inflation” had begun. The US dollar index, which measures the greenback against six other major currencies, fell about 0.13% to close at 103.32, down from a one-month high of 103.96 hit earlier this week after a better-than-expected jobs report. on friday The latest NFP report initially fueled speculation that the Fed might move to a more dovish stance, but Fed Chairman Powell refrained from sounding dovish in his latest speech. Next week, many economists will focus on the CPI on Tuesday as they look for further clues about the Fed’s future rate hike. OCBC currency strategist Christopher Wong said comments from members of the Federal Reserve on further rate hikes were supporting the dollar. “On the one hand, Powell’s comments at the Economic Club of Washington last night were less funny, but on the other hand, Fed officials like Williams (and Fed Governor) Lisa Cook used the opportunity to reinforce the hawkish rhetoric,” Wong. said said . , The euro rose about 0.18% against the dollar near 1.07325, down from Tuesday’s one-month low of $1,067, supported by comments from ECB officials. “Where I am today, we need more meaningful rates,” German central bank president Joachim Nagel told the Boersen-Zeitung newspaper on Tuesday. His colleague Isabel Schnabel said it was not clear whether the ECB’s rate cuts so far would slow inflation to nearly 2 percent. , In the US stock market, key US futures were slightly higher as many market participants looked to other earnings reports. , Dow Jones futures were up about 20 points, while S&P 500 futures were up about 0.67% and Nasdaq 100 futures were up about 0.89%. Many companies, including Disney and Mattel, reported earnings after the market closed. Disney shares rose more than 5% in the late-night session after a smaller-than-expected loss in subscribers and beat revenue and earnings per share. Many economists follow earnings reports to learn more about how many companies are doing and how they are doing during high inflation. Thursday, many analysts expect new earnings reports, with companies such as PepsiCo releasing results before the market opens, while PayPal, Lyft and Expedia are among the companies to report quarterly after the market closes. Oil prices were slightly lower in the first session on Thursday, as a report on US crude inventories offset the possibility of higher energy demand in China following China’s reopening after transitioning to a zero-covid-19 policy. near the highest level in months, which could indicate weakening demand in the US economy. Brent crude futures were near $85.10 by 0 6 GMT, while US West Texas Intermediate (WTI) crude futures were near $78. . Both oil futures added more than 6% this week. US crude … inventories continued to beat expectations, somewhat undermining bullish sentiment on hopes of a recovery in Chinese demand, analysts at Haitong Futures say. , U.S. crude inventories rose last week to near their highest since June 2021, supported by higher production, according to the Energy Information Administration. , However, the possibility of demand growth in China continues to support oil prices as one of the largest oil-consuming nations reopens its economy after three years of COVID-19 restrictions. “Tourism in China has grown strongly since the Lunar New Year holiday. We expect China’s oil consumption to increase by about 1.0 million barrels per day this year, with strong growth already evident at the end of the first quarter,” said customer note . Daniel Hynes and Soni Kumari, analysts at ANZ Bank. “Overall, this is expected to increase global demand by 2.1 million barrels per day in 2023.” Meanwhile, BP Azerbaijan reported a force majeure on oil shipments to Azerbaijan from the Turkish port of Ceyhan after the February 7 earthquake that hit Turkey and Syria. The disaster halted operations at Ceyhan and halted the flow of oil from Iraq and Azerbaijan.

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