Dollar bulls tried to breach Dollar Index resistance at 104.50 on Friday but came up short, trading to an intraday high of 104.447 (still the highest point for the dollar since June 1st). Profit-taking left the DXY at 104.077 to close out the week with a 0.68% gain, and the dollar’s 6th consecutive weekly advance.
The USD is lower today in directionless trading. Today’s Summer Bank holiday in the U.K. has reduced the usual daily turnover, limiting liquidity. The primary dollar moves are -0.52% vs. SEK and -0.23% vs. AUD.
U.S. Treasuries have started to make a move since the NY market open, with lower yields seen across most tenors, but centering around the 10-year which is -0.037%. Following the Fed’s Jackson Hole Symposium last weekend, the probability of a 25-basis point hike at the FOMC’s November meeting has risen to 44.8% probable. The message that rates will need to stay elevated for longer than previously projected is being priced into markets.
This week’s U.S. economic calendar includes tomorrow’s Consumer Confidence, Annualized Quarterly GDP on Wednesday, Weekly Jobless Claims on Thursday, and culminating with Friday’s Change in Nonfarm Payrolls. Canadian economic data centers on Friday’s Annualized Quarterly GDP, GDP MoM, GDP YoY, and Manufacturing PMI. Mexico will also see GDP data results (tomorrow), Unemployment for July, and Manufacturing PMI due out on Friday.