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USD: Consumer credit data is released late in the day but is not expected to upset the better tone to the dollar.

EUR: Note that finance ministers meet today to discuss, among other things, the progress Greece has made towards securing its next bailout tranche. Also, ECB President Draghi speaks this afternoon and both events worth watching for residual event risk.

Idea of the Day

The result of Friday’s US employment report was to push the dollar back to new highs for the year on the dollar index and to levels last seen 3 years ago. The positive revisions to the US headline payrolls mean that the average of the past six months sits above 200k, an outcome that has enhanced the view that the Fed will start tapering its bond purchases later this year and quite possibly as early as the September meeting.

But also offering support from the other side were the announcements from both the ECB and BoE, effectively promising to keep rates low for “an extended period” in the case of the ECB.   Both announcements have given dollar bulls more confidence.

Latest FX News

USD: Supported both by the payrolls report and also the weaker tone to both the euro and sterling, ensuring that tapering talk will remain strong.

EUR: The single currency retaining the softer tone gained in the wake of the ECB press conference last week during which the ECB President pledged to keep rates low (or lower) for an extended period of time. Explicit nature of this promise has given bulls little reason to fight the weaker tone.

JPY: A new high for this up-move at 101.53 on USDJPY.   Headline data on trade was broadly in line with expectations overnight. Focus is on BoJ meeting scheduled for Thursday of this week.

AUD: The firmer dollar tone from Friday has allowed the Aussie to start the week just above the 0.90 level, with the domestic backdrop still offering few reasons to be bullish.