DXY holds strength ahead of slew of data releases
Daily Currency Update
The US Dollar Index was up this morning around 0.21% to the 103.54 level. The USD rose against the EUR and GBP. The Richmond Manufacturing Index, which surveyed about 100 manufacturers in the Richmond area and asked them to rate the relative level of business conditions, was released at a lower-than-expected level and lower than the previous reading. The index fell to -15 from -11 in December, marking its third consecutive negative reading. This was also worse than the expected -7. While this data usually pulls the USD down, it remained strong ahead of Purchasing Manager’s Index (PMI) data set to be released tomorrow, Gross Domestic Product (GDP) data on Thursday, and Personal Consumption Expenditure (PCE) on Friday.Key Movers
European consumer confidence data came in lower than expected at -16.1 for January, falling from December’s five-month high. This hurt the euro as the GBP gained strength, rising to its highest level against the EUR since September 2023.The Bank of Japan (BoJ) decided to keep the rates the same. However, they indicated that it might be the end to negative interest rate policy. This initially caused an increase in the JPY versus USD, but the uptrend quickly dipped as the USD was up this morning around 0.24% against the JPY. Japanese core Consumer Price Index (CPI) yearly data came in lower than expected and previous, which could have influences the BoJ’s decision to hold rates steady.
The Loonie was up around 0.4% and 0.29% this morning against the EUR and GBP respectively. This CAD strength can be attributed to a slight rise in oil prices to trade around 74.84 a barrel, boosting the Canadian dollar. Additionally, New Housing Price Index (NHPI) data came in as expected with a 0% change and above the previous -0.2% reading in December 2023. The USD/CAD rate has stayed mostly constant since yesterday with the USD edging up slightly this morning by 0.0037%.
Expected Ranges
- EUR/USD: 1.0853 - 1.0918 ▼
- GBP/USD: 1.2681 - 1.2747 ▼
- AUD/USD: 0.6567 - 0.6613 ▲
- USD/CAD: 1.3448 - 1.3488 ▼