The dollar has continued its rally on Wednesday, climbing to its highest level in three months as traders focused on the rising bond yields (US10Y; 3.031%) Stocks were also firm (DJI +0.25%), despite the higher interest rates and resilient in the face of disappointing US corporate earnings. The dollar has been the main game today though and it is trading above its previous session highs against all its major counterparts except Sterling, with the Yen, commodity bloc and the Swiss Franc being the worst performers, and with EurChf attempting but so far failing, to make another run at the 1.2000 hurdle. The dollar seems set to continue its current run higher, with the Euro being in focus today due to the ECB Meeting.
WTI settled a little higher after data showing an unexpected build in crude supplies was offset by record exports of crude last week. US Inventories unexpectedly rose by 2.170 million barrels confounding expectations for a draw of 1.6 million barrels although this was offset by a sharp uptick in crude exports to 2.331 million barrels last week, up by more than 30% from 1.749 million barrels the prior week.
All eyes will be on the ECB today although no change is expected to monetary policy. However a dovish/cautious outlook from Mario Draghi would not surprise given the recent deterioration in the EU economic data, while at the same time the March inflation data remained benign and the geopolitical risks remain elevated. There will be little from Asia, while from the US we have a busy session with the March Durable Goods Orders (exp 1.6%, Ex-Auto; 0.5%), the Goods Trade Balance (exp -$77.7 bio), the Kansas Fed Mfg Activity (exp 17) and the weekly jobless claims. Have a good day.
|INDICES / COMMODITIES|