MORNING ROLL CALL
U.S. Dollar falls as Trump labels the currency “too strong”, cable rises, USA equities slide, crude oil falls, whilst gold rises
Economic calendar events deferred to the power of an unnecessary, shooting from the hip, gunslinger style comment, courtesy of the president of the United States Donald Trump, on Wednesday. His opinion; that the dollar was “too strong” and that he’d prefer if the FOMC kept the interest rates low, caused a sell off in the greenback, versus the majority of its peers.
He also decided that China was suddenly “not a currency manipulator”, despite labelling the country as such less than two months back. As we mentioned some time back, perhaps a new section needs adding to the daily, economic calendar events; Trump tweets and reckless brain dumps. USD/JPY ended the day down approx 0.5% to circa 108.99, GBP/USD rose by circa 0.5% to 1.254, USD/CHF slipped to 1.0027, whilst EUR/USD climbed up 0.55%, to 1.0662.
USA economic calendar events were thin on the ground on Wednesday, the biggest miss was the March monthly budget statement, coming in at a -$176.2b deficit, versus the consensus forecast of $169b and the previous reading of $108b. The DJIA closed down 0.29% and the SPX down 0.38%, political issues and clumsy statements overriding the day’s hard data.
The Loonie, Canada’s domestic currency, increased in value versus the U.S. dollar on Wednesday, USD/CAD falling by approx. 0.5%, to close the day out at circa 1.3248. Canada’s central bank kept their base interest rate unchanged at 0.5%, with governor Poloz suggesting (in the accompanying monetary statement), that any adjustment to the interest rate is unlikely in the near future.
The UK’s FTSE closed down 0.22%, the key UK economic data published on Wednesday was employment/unemployment data. The mainstream media quickly closed in with laser focus on the supposed encouraging labour force survey data, courtesy of the press release from the ONS.
However, closer inspection revealed that the data was in fact not that encouraging. Jobless claims in the UK increased in the month of March by 25.5k, from -6.1k in Feb. whilst the employment change missed the forecast, coming in at 39k jobs added over the quarter period up to March, versus expectations of a 70k improvement, with a 92k gain recorded previously. Analysts in the mainstream media, excitedly cited the “good jobs data” as a reason for sterling’s gains throughout the day, despite the UK’s pound only making gains versus the U.S. dollar, which fell due to Trump’s statements, not sterling’s strength.
The U.S. dollar index sold off by circa 0.4% on Wednesday, WTI oil fell by circa 1% to $52.71 per barrel, despite the encouraging falling stockpile news and data from the USA. PMs (precious metals) made gains; gold closing the day out at circa $1285 per ounce, up 0.3%, with silver also rising, to reach $18.48 per ounce.
Economic calendar events for April 13th, all times quoted are London (GMT) time
06:00, currency impacted EUR. German Consumer Price Index (YoY) (MAR F). The consensus forecast, from the economists polled, is for no change at 1.6% annually.
12:30, currency impacted CAD. New Housing Price Index (YoY) (FEB). The previous reading was 3.1%, there is no expectation for a significant diversion from this current reading.
12:30, currency impacted USD. Initial Jobless Claims (APR 08). Weekly jobless claims are expected to rise moderately to 245k, from a reading of 234k previously.
14:00, currency impacted USD. U. of Michigan Confidence (APR P). The UOM confidence survey is one of the most respected ‘soft data’ surveys on the overall health of the USA economy. The expectation is for no change, on the 96.6 reading recorded in March.
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