The market still expects the Bank of England to hike rates even as recent data pointed weaker, says Kathy Lien of BK Asset Management.
Investing.com - Gold prices continued the downward trend on Friday, adding to small weekly losses in relatively static trade.
The dollar headed higher against most rival currencies on Friday, lifted by rising U.S. Treasury yields, which came on the back of a rally in commodity prices that has pushed up inflation expectations. The pound continued to slide after hints from Bank of England Governor Mark Carney that the U.K. central bank may hold off on raising interest rates next month. The ICE U.S. Dollar Index (IFUS:DX-Y.NYB) rose 0.1% to 90.016, trading around its highest level since April 9, according to FactSet data.
The U.K. pound continued to slide Friday after Mark Carney, the governor of the Bank of England, took markets by surprise and hinted that the British central bank could hold off raising interest rates next month. In an interview with the BBC, Carney highlighted a recent run of disappointing data and the uncertainty over the final Brexit deal as he tried to temper expectations. “Prepare for a few interest rate rises over the next few years.
Investing.com – Cryptocurrencies continued to rebound on Friday, while reports that South Korean-based crypto exchange Bithumn is considering to issue its own digital coins in Singapore garnered some attention.
Investing.com – Gold prices were trading lower on Friday as the U.S. dollar rose amidst higher 10-year U.S. treasury yields.
Investing.com – The dollar rallied against other major Asian currencies on Friday morning. Japan’s inflation data were in focus on Friday as investors looked for cues for the country’s monetary policy.
Commodities have been a hot topic this week, particularly crude oil and base metals. Traders are saying that threats of a trade war and continued signs of global growth may be combining to create opportunities investors haven’t seen in a number of years.
Inflation numbers out of Japan eased in March, giving the BoJ little reason to make a near-term move, with U.S Treasury yields hitting the Asian markets. Retail Sales and Inflation numbers out of Canada the main event for the day ahead.
The current price action indicates that the relatively optimistic view about the U.S. economy should be enough to support the Fed’s notion to raise interest rates at least two more time in 2018. Some traders are even pricing in as many as three rate hikes.
Gold markets initially rally during the day on Thursday but gave up gains as we broke below the $1350 level again. However, I think there is plenty of support underneath, so I think it’s only a matter of time before the buyers step in and start pushing higher again.
The greenback continued to go back and forth during trading on Thursday, as the 107.50 level should continue to be an area of interest. I believe that if we can break above this level, then we could see a significant move towards the vital 108 level.
The US dollar pulls back a bit during the Thursday session initially, but also turns around find a bit of support at the 1.26 region. I think at this point it comes down to oil, and what it does next. The oil markets have been very bullish, so that would perhaps pray tell a move lower in this pair, but it looks like were trying to see some type of fight.
The New Zealand dollar rolled over during the trading session on Thursday, breaking down below the 0.73 level. This shows signs of a move towards the support level underneath, which I believe is what we are about to see.
The British pound has pulled back slightly at the open on Thursday, but then bounced enough to form a bit of a “W pattern” on the hourly chart. I believe that we are trying to break out to the upside again, but remember, this pair is going to be very choppy as the United Kingdom continues to discuss leaving the European Union.
The British pound initially fell during trading on Thursday but found enough support near the 152 level to turn things around and show signs of strength again. I believe that this market will continue to act as a barometer for risk appetite around the world, and therefore should be looked at as such.
The EUR/USD pair continues to bounce around just above the 1.2350 level. There’s also an uptrend line underneath that should continue to keep this market positive, so I like the idea of picking up short-term pullbacks.
The EUR/GBP pair has broken down during the day on Thursday, breaking below the 0.87 handle. That is an area that has been support in the past, and now is acting as resistance. I believe that this pair will continue to be very noisy, based upon the negotiations between the United Kingdom and the European Union.
The Australian dollar rallied a bit during the trading session on Thursday, reaching as high as 0.78 again, before pulling back as we continue to struggle to maintain a sustained move.
SAO PAULO/MEXICO CITY, April 19 (Reuters) - Latin American currencies fell against the dollar on Thursday, with the Mexican peso posting the strongest fall, as traders took advantage of an opportunity to make a technical correction amid continued political uncertainty. The peso fell 2.01 percent against the dollar just days after reaching its strongest level since September as investors banked on improved odds of a new North American Free Trade Agreement being signed. Traders in Mexico continue to be spooked by the strong performance in opinion polls by leftist Andres Manuel Lopez Obrador.
Investing.com – The dollar remained close to highs against a basket of major currencies as surging bond yields offset earlier weakness in the greenback.
Time is running out for reforming the euro zone while the urgency of doing so for policymakers has been reduced due to a robust economic rebound in the single currency bloc, top European economic officials warned on Thursday. The 19 countries that share the euro are now enjoying the strongest growth in a decade after years of economic crisis that almost unravelled the euro zone. Top policymakers have argued that the euro zone should fix its remaining weaknesses while its economy is on the upturn so that it is better prepared for the next downturn.