The US Dollar ended lower after what was yet another week of high political and economic drama. Say what you will about the Trump Presidency, it’s never dull… The US Dollar’s index against a basket of major currencies opened the week around 89.80. If fell half a point on Monday, rallied back to 90.00 for the first time in three weeks on Tuesday then tumbled almost a full point to a low on Thursday morning of 89.05. A near-half point rally was then entirely reversed on Friday and having reached a low of 89.00, it ended only a few pips above this level. In the first trading session of the week in Asia, the USD has slipped against the EUR but is holding strong against the Yen and its index is around 10 pips lower at 88.95; its lowest level since February 20th.
Last week was the worst weekly performance by the US stock market since January 2016 with the Dow Jones Industrial Average finishing at a four-month low. As the Facebook story broke last Monday, the DJIA was down 500 points intra-day and more than $100bn was wiped off the value of technology shares. It ended the day down 330 at 24,610. Tuesday brought a 100-point gain and Wednesday a 100-point loss. On Thursday President Trump announced the US Trade Representative’s “Section 301” investigation into alleged misappropriation of US intellectual property by China and the DJIA fell 325 points, followed by a further 420 points loss on Friday. The picture is just as bad for the S&P 500 Index which fell six per cent on the week. Indeed, the S&P 500 has closed lower than the midpoint of its daily range for 10 straight days, the longest stretch since at least 1982. The index closed on Friday at 2,588.26, hovering just above its 200-day moving average and its decline since March 9th was its third dip of at least 5 percent in the past two months.
Economic data in the US is quite to start the week but will ramp up as we go. Today’s event risks come from FOMC members speeches from Dudley, Mester and Quarles keynote addresses are at 12:30 pm, 4:30 pm, and 7:10 pm respectively. Top-tier economic data begins tomorrow with Conference Board Consumer Confidence figures expectations are for 126.6 while previous was at 130.9. Wednesday we have the most important figure of the week released at 8:30 am, 4th quarter GDP and annualized, expansion is for 2.1% and 3.3% respectively. Thursday has weekly continued and initial jobless claims reported along with personal income and spending numbers, PCE core price index month over month and year over year are released, this will be topped off at 10 am with the Michigan Consumer Sentiment forecast reported which is expected to be in line with the previous of 102.