US Dollar Index makes gains to end the week
Daily Currency Update
The US Dollar Index (DXY) was up over half a percent to start the Friday session as markets latched onto the “higher for longer” rate predictions from the Federal Reserve Bank. This comes following yesterday’s European Central Bank (ECB) rate announcement. Much like the Bank of Canada (BoC) on Wednesday, the ECB didn’t change its overnight rate. The ECB did, however, leave the door open for a rate cut in June. With the Fed now not expected to cut rates until the fall, money is in motion to US treasuries. The DXY traded in the 105.97 levels this morning.Key Movers
In Eurozone news, inflation data overnight from both Germany and France came in as expected, lending more support to the idea that the ECB could make a move. German inflation came in at 2.2% for last month while the numbers in France showed 2.2% on annual price increases. The Euro was down further this morning against the USD as markets priced in a June Rate cut from the ECB.The Canadian dollar was down again today as the USD gained against all other major currencies. With a lack of data out of Canada today, this dip in the CAD was part of the market’s outlook for central bank rates moving forward. With the BoC and ECB expected to make cuts in June while the Fed is expected to hold rates until the fall, all the currencies measured against the USD were down to end the week. Oil continued to make gains as reports from the Middle East drove further geopolitical risks. These reported tensions were keeping oil prices elevated with West Texas Intermediate (WTI) crude oil climbing back over $86 a barrel.
Expected Ranges
- EUR/USD: 1.0636 - 1.0749 ▼
- GBP/USD: 1.2455 - 1.2572 ▼
- AUD/USD: 0.6478 - 0.6551 ▼
- USD/CAD: 1.3665 - 1.3765 ▲