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The Greenback continues to bounce, helped by a weak Pound.

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USD – United States Dollar

Without many economic releases today in the U.S. calendar, the Sterling’s weakness, which is sinking following dovish remarks by a BoE official (see key drivers section for more details), is a likely reason for the U.S. dollar index to increase 0.11 percent along with the Bloomberg U.S. dollar index rising by the same percentage.

The United States and China are expected to sign their phase one deal to end their tariff battle this week; these expectations are pushing the Chinese Yuan to new highs against the U.S. dollar from July 2019; it is currently trading at 6.8912 Yuan against the U.S. dollar. It also touched a six-month high (for the Yuan) at 6.8835.

Regarding key drivers for the U.S. dollar, Fed Bostic is going to discuss the economic outlook and monetary policy later today, and Fed Williams and Fed George are going to speak tomorrow. The cherry on top of the cake will be U.S. Federal Reserve Beige Book and Fed Harker’s discussion on economic outlook on Friday.

Key Movers

The BoC and ECB will release their decisions on monetary policy next week, on the 22nd and on the 23rd of this month, which will shed some light in the Pound and the Loonie. However, for now, the biggest loser this morning is the Pound, followed by the Japanese Yen.

The Sterling is falling today as weak GDP data added to the case of the BoE rate cut. Monthly GDP came in at -0.3 percent month to month versus the expected 0 percent. Furthermore, recent comments from BoE officials are suggesting that they’re open to easing if data don’t show improvement. BoE policymaker Gertjan Vlieghe said he would vote for an interest-rate cut this month if there are no signs of the economy improving. This Wednesday at 4:30, CPI numbers will be released in the U.K.

Regarding the Euro, there are two European Central Bank speeches scheduled for tomorrow by Yves Mersch in Frankfurt and François Villeroy in Paris.

Expected Ranges

USD/CAD: 1.3006 – 1.3066 ▼

EUR/USD: 1.1109 – 1.1134 ▲

GBP/USD: 1.2913 -1.3000 ▼

AUD/USD: 0.6869 – 0.6909 ▼

NZD/USD: 0.6610 – 0.6640 ▼


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