Will a continued large-dollar decline persist? Attention on Powell's remarks! ~ January 10 highlights and schedule ~
Yesterday was subdued ahead of the FOMC minutes, but once the New York market opened, remarks from FOMC members were all dovish, leading to a sharp decline in the dollar. The content of the FOMC minutes afterward also being dovish helped the dollar’s decline.
◎ Today’s Points of Focus
1) ECB Governing Council Meeting Minutes
Yesterday, with the large decline in the dollar, the euro rose. The EUR/USD climbed to a four-month high.
Today we will see the release of the ECB Governing Council meeting minutes. Some economic slowdown is likely already priced in. However, if the slowdown proves larger than expected, or if expectations for rate hikes in the latter half of the year are pushed back, the euro could come under selling pressure.
2) Powell, Fed Chair, and Key Speeches
Following the consecutive dovish remarks from FOMC members yesterday, the U.S. dollar declined sharply. An even more dovish FOMC minutes were released, intensifying the trend.
Today, speeches by Fed Chair Powell and other FOMC members are scheduled. Attention is on whether dovish content will continue or if some hawkish notes will emerge.
3) U.S. Budget and Trade talks
U.S.-China trade talks concluded a day late. A statement is due this morning. If nothing problematic is contained, risk sentiment may ease.
However, the growing risk factor is the U.S. budget and partial government shutdown. This morning, President Trump walked out of a meeting with Democratic lawmakers, calling it a waste of time. If the shutdown persists, economic losses will grow, and downgrade risks may arise. Stay tuned to the U.S. budget.
4) Brexit Plan, UK Parliament Vote
In the UK Parliament, discussions are underway ahead of next week’s vote. While amendments are being put to a vote, Prime Minister May’s position remains precarious. The pound has been moving sharply on Brexit-related headlines, so close attention is required.
◎ Today’s Economic Calendar
January 10 (Thursday)
09:30 JPY Bank of Japan Governor Kuroda speaks
10:30 CNY Consumer Price Index (CPI)
16:00 NOK Consumer Price Index (CPI)
17:30 SEK Industrial Production
21:30 EUR ECB Governing Council minutesECB Governing Council Minutes
22:35 USD Barkin and Richmond Federal Reserve Presidents speak
January 11 (Friday)
02:00 USDPowell, Fed Chair speaks
02:30 EUR Bank of France Governor Villeroy de Galhau speaks
02:40 USDBrainerd, Federal Reserve Governor speaks
03:00 USDEvans, Federal Reserve Bank of Chicago President speaks
03:00 USD 30-year bond auction
03:20 USD Kashkari, Federal Reserve Bank of Minneapolis President speaks
06:45 NZD Building Permits
07:30 USDClarida, Fed Vice Chair speaks
09:30 AUD Retail Sales
◎ Weekly Schedule
