USD - United States Dollar
The US dollar index rises 0.12 percent this morning following the positive increase in the “second” estimate of first quarter Gross Domestic Product (GDP) by the Bureau of Economic Analysis, where GDP increased at an annual rate of 3.1 percent in the first quarter of 2019. The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. Furthermore, the wholesale inventories showed $72.1 billion in April, up to $0.2 billion from $71.9 billion in March.
On the flip side, according to the Labor Department this morning, the number of Americans filing applications for unemployment benefits increased moderately last week, suggesting the labor market remains solid even as the economy is slowing. Initial claims for state unemployment benefits rose 3,000 to a seasonally adjusted 215,000 for the week ending on May 25th.
The Greenback might continue or reverse its gains after Clarida’s speech -a FOMC member- later today at noon EST.
The Euro is weakening this morning. The EUR/USD and EUR/CAD pairs are falling 0.1 and 0.3 percent respectively. After ten months, President Trump and European Commission President Jean-Claude Juncker have yet to reach an agreement. It seems like the agreement of a tariff truce has had very little progress. Cecilia Malmstrom, the EU's trade commissioner, told reporters in Paris after meeting with US Trade Representative Robert Lighthizer, “I don't think the US is ready to start on the tariff negotiations."
Furthermore, the growing polarization in Europe is evident in the recent elections that saw a fragmentation of the mainstream center-right and center-left parties that some in Washington see as a sign of the more significant structural obstacles to a deal. In China, Ministry of Commerce spokesman Gao Feng said he hopes the US will fix its inappropriate practices and added that any progress in the trade talks depend on America's attitude. He also reiterated that China couldn't accept its rare earth products being used against itself, although it is willing to meet other countries' demand. The USD/CNH falls 0.08 percent this morning (stronger Yuan).
1.3469 - 1.3521 ▼EUR/USD:
1.1110 - 1.1146 ▼GBP/USD:
1.2559 - 1.2606 ▼AUD/USD:
0.6891 - 0.6920 ▼NZD/USD:
0.6485 - 0.6509 ▼