The Federal Reserve left rates unchanged yesterday which was expected, therefore market participants were looking to the statement for cues to trade off of. The report referenced that inflation was moving toward the Fed 2% target at a manageable pace, signaling that the Fed has room to tighten further down the road without the worry of inflation running away. The greenback made initial gains against it trading peers before settling down to levels before the announcement. The focus now moves to US jobs with Non-Farm Payroll numbers tomorrow with forecasts of 198k well above last month dismal 103k; a good number will support the greenback and signal further tightening from the Fed. The dollar index which is the gage of the US dollar against a basket of currencies up 1.05% in a week and 2.62% over the month.
Attention will now be focused on the evolution of interest rates, specially Treasury yields, with the curve steepening a bit following a mild increase in the long-end part. Also, US Treasury Secretary Steven Mnuchin will be holding trade talks in Beijing with Chinese Vice Premier Liu He.