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DXY holds steady amid lower-than-expected Economic Optimism data

Weston Blystone
Written by
Weston Blystone

Weston Blystone

OFXpert

At OFX, Weston collaborates closely with businesses, guiding them and providing invaluable insights into foreign exchange strategies to mitigate risk effectively.

| Tuesday 7 May, 2024

Daily Currency Update

The US Dollar Index (DXY) was largely unchanged so far today with a slight 0.03% increase to trade near 105.09 this morning. The DXY seemed to remain stable with the only notable data release today coming in the form of an Economic Optimism survey from RealClearMetrics (RCM) and TechnoMetrica Institute of Policy and Politics (TIPP). The Economic Optimism index surveys consumers, asking them to rate the relative level of economic conditions. The results came in lower than expected at 41.8 versus 44.1. While this data did not have a large impact on the US dollar, it showed some depleting confidence in economic health in the US. The USD was up slightly versus the CAD, GBP, and AUD this morning.

Key Movers

In the Eurozone, the French Trade Balance came in lower than expected at -5.5 billion versus the expected -5 billion. Despite this data, the EUR was up slightly against the GBP, CAD, and USD so far this morning.

The GBP Construction Purchasing Manager’s Index (PMI), which asks construction purchasing managers to rate the relative level of business conditions, was released with higher-than-expected numbers at 53 versus the expected 50.4. These higher numbers signaled growth in the construction sector and could help increase the strength of the GBP.

Last night the Reserve Bank of Australia (RBA) decided to hold rates at 4.35%. This decision came shortly after the AUD hit USD $0.66, a significant threshold for the pair. The AUD/USD pair fell after the announcement but seemed to be climbing back to the 0.66192 range this morning.

The Canadian dollar dipped slightly this morning against most major currencies as oil fell. West Texas Intermediate (WTI) oil was down around 0.7% to the 77.93 level this morning. Oil looked to have affected the Loonie as it struggled against the USD, EUR, GBP, and AUD so far today despite positive Ivey Purchasing Manager’s Index (PMI) data. Ivey PMI numbers came in higher than expected at 63 versus 58.1.

Expected Ranges

  • EUR/USD: 1.0754 – 1.0787 ▲
  • GBP/USD: 1.2529 – 1.2570 ▼
  • AUD/USD: 0.6586 – 0.6643 ▼
  • USD/CAD: 1.3658 – 1.3692 ▲

Written by

Weston Blystone

OFXpert

Weston is on a mission to help people optimise their foreign exchange transfers. As Corporate Client Associate at OFX, he collaborates closely with businesses, guiding them and providing invaluable insights into foreign exchange strategies to mitigate risk effectively. Always eager to deepen his understanding and share his expertise with others, Weston finds great fulfilment in working with diverse individuals, nurturing their company’s growth through tailored solutions.

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