Marketwatch North America

Daily Insights
April 17, 2024

In a speech yesterday to a policy forum, Federal Reserve Chairman Powell addressed the Fed’s rate policy in light of recent economic data:

  • ‘More recent data shows solid growth and continued strength in the labor market, but also a lack of further progress so far this year on returning to our 2% inflation goal.’
  • ‘We can maintain the current level of restriction for as long as needed.’
  • ‘The recent data have clearly not given us greater confidence, and instead indicate that it’s likely to take longer than expected to achieve that confidence.’

The year-end implied overnight reached 4.923% following Powell’s comments compared to the current 5.329% implied rate, or only 0.406 basis points of expected cuts. In January the 2024 year-end implied rate was 3.65% so more than five 25-bps have now been priced out.

The dollar is lower today, its first drop after six consecutive daily gains following U.S. yields lower. The dollar index is -0.04% at 106.223 after reaching a 6-month high of 106.517 yesterday. Dollar declines vs. the G10 range from -0.53% vs. NZD to -0.03% vs. SEK. The dollar’s biggest decline against the majors is a 1.01% drop vs. the Mexican peso. The dollar had rallied 4.79% vs. the MXN over the previous six trading days to reach 17.0950, USDMXN’s best since Feb 29th.

U.S. Treasury yields are lower in the 2yr-30yr tenors, the mid-tenors leading the way lower, down 0.057bps. The 10-year yield is -0.053.

Gold is +0.20% at $2,387.56. A daily close above $2,382.51 will mark a new record. Gold has appreciated 15.78% YTD, outdone by silver’s 20.18% YTD gain.

Oil is -1.35% at $84.20/barrel but remains +17.49% YTD. Gasoline is -1.94% today, but up a hefty 31.64% YTD.

Economic Calendar

CAD - Foreign Securities Purchases
AUD - MI Leading Index m/m
All - IMF Meetings
USD - Crude Oil Inventories
GBP - BOE Gov Bailey Speaks
GBP - MPC Member Haskel Speaks
USD - Beige Book
GBP - CPI y/y
GBP - Core CPI y/y
GBP - PPI Input m/m
GBP - PPI Output m/m
GBP - RPI y/y
EUR - ECB President Lagarde Speaks
USD - TIC Long-Term Purchases
GBP - HPI y/y
USD - FOMC Member Mester Speaks
USD - FOMC Member Bowman Speaks
EUR - Final Core CPI y/y
EUR - Final CPI y/y
EUR - German 30-y Bond Auction
GBP - BOE Quarterly Bulletin
GBP - MPC Member Greene Speaks

Market Indicators

Currency Pairs
Pair High Low
usd/jpy 154.733 154.453
eur/usd 1.06492 1.0606
gbp/usd 1.2482 1.2417
aud/usd 0.64318 0.64025
usd/cad 1.38377 1.38006
eur/gbp 0.85513 0.85209
usd/mxn 17.0853 16.9224
Equities and Commodities
S&P 500 5081.89
NASDAQ 17814.9
DOW 37902.1
GOLD 2386.59
SILVER 28.55

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.